Fund Accounting Interview Questions with a NAV Case

1. What is NAV per unit, and which assets, liabilities and units would you need before calculating it?
2. How would you distinguish a trade-date entry, a settled cash movement and a position shown by a custodian?
3. What would you check if the holdings record and an approved price source disagree for one security?
4. Why might income accrued for a period differ from cash actually received during that period?
5. How can an expense accrual affect net assets even before the expense is paid?
6. What checks would you perform before using a corporate-action entitlement in a NAV process?
7. If yesterday's and today's NAV differ, which inputs would you compare before explaining the movement?
8. How would you document an unresolved break, its potential NAV effect, the owner and the next authorised action?

The interviewer gives a fictional scheme with securities valued at INR 975 lakh, cash of INR 45 lakh and receivables of INR 15 lakh. Approved liabilities and accrued expenses total INR 25 lakh. There are 100 lakh units outstanding. All figures are assumed to refer to the same valuation date, and the case omits scheme-specific pricing and unit-activity rules. Under these assumptions, total assets are INR 1,035 lakh and net assets are INR 1,010 lakh.

An effective answer says: 'On the supplied figures, illustrative NAV per unit is INR 10.10. Before treating it as a final number, I would verify the holdings and price source, cash and receivables, approved expense accruals, liabilities, unit count, date, and required reviewer sign-off.' AMFI describes NAV per unit as a scheme's value divided by outstanding units; actual scheme disclosures and operations carry more detail than this classroom example.

Now suppose a second fictional record supports INR 970 lakh of securities value, INR 5 lakh below the first figure. If every other input stayed fixed and that second figure were the approved one, net assets would be INR 1,005 lakh and illustrative NAV would be INR 10.05 per unit. The INR 0.05 difference shows potential impact; it does not tell the candidate which source is correct. Check the security identifier, quantity, price timestamp, currency, corporate action, valuation policy and approval trail. Preserve both source values, document the break and route it to the designated owner under the applicable process.

• You keep INR lakh and lakh units consistent, producing INR per unit rather than an incorrect scale.
• You distinguish an illustrative calculation from an authorised published NAV.
• You identify whether a difference is a timing, quantity, price, cash, accrual or unit-record question before proposing a fix.
• You describe maker-checker review, source preservation and escalation without claiming authority you do not have.
• You use fictional or approved public data in a student portfolio, never a confidential client or fund file.

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This case is an educational exercise with invented data. It is not a procedure for publishing an actual scheme NAV, investment advice or a promise of a fund accounting job.