Ernst & Young recently released the provocative results of its annual hedge fund survey entitled, “Coming of Age: Global Hedge Fund Survey 2011.” The survey polled hedge fund managers and investors on a range of relevant topics, notably including valuation and the use of administrators. See “Ernst & Young Survey Juxtaposes the Views of Hedge Fund Managers and Investors on Hedge Fund Succession Planning, Governance, Administration, Expense Pass-Throughs and Due Diligence,” Hedge Fund Law Report, Vol. 5, No. 1 (Jan. 5, 2012). Many of our subscribers are profoundly interested in the topics of valuation and administrators. Accordingly, we recently interviewed Arthur Tully, the Co-Leader of E&Y’s Global Hedge Fund Practice, to dig deeper into the survey results on these two topics, and to go beyond the survey to explore Tully’s extensive experience in these areas. Our interview covered a range of topics on which HFLR subscribers have requested additional insight, including: the level of comfort that investors should take in an administrator’s valuation of Level 3 assets; the level of interest on the part of investors in independent reconciliation of a hedge fund’s investment positions to custodians and prime brokers; who pays for “shadowing” of an administrator by a hedge fund manager and alternatives to shadowing that can provide the same level of comfort to investors; how managers can reconcile and document differences between their calculations of NAV and administrators’ calculations of NAV; independent administration considerations for UCITS funds; the interaction between valuation firms and administrators; hedge fund manager valuation committees; the roles of the board of directors and chief compliance officer in the valuation process; what SEC examiners are looking for with respect to valuation; and how to gather the data necessary to complete Form PF. The full text of our interview with Tully is included in this issue of the Hedge Fund Law Report.