If the SPV’s assets exceed certain thresholds in any given year, it is required to file an audit report. There are two types of audits:
— Review (or ‘light’ audit): When total assets exceed €3.0 million. This currently starts at about €5,000 per report.
— Audit (or ‘full’ audit): When total assets exceed €7.5 million. This currently starts at about €7,500 per report.
These thresholds (€3.0 million and €7.5 million) may increase periodically.
As per our Loan Agreements, if the SPV meets the requirements above, it will cover these costs and deduct them from investors’ distributions upon a liquidity event.
So, can our SPVs raise more then 3.0m EUR? Yes, but we will ask the deal lead to leave a portion of their fees in the SPV’s bank account to cover these costs until the exit. Upon exit, the SPV will deduct these costs from investors’ distributions and reimburse them to the deal lead.