Birch and Waite ......latest Blue Sky project, page-31

Great point. The fact that they sold one of their investments for up to 23% less than its carrying value is actually quite a serious matter. They would no doubt have been booking to NPAT accrued performance fees on the carrying value of the investment, which will presumably now have to be written out of receivables since there shouldn't be any performance fees paid for an investment that doesn't make the typical 8% hurdle.

Obviously one investment won't represent the performance of the whole portfolio, however it highlights exactly the issue that Glaucus was raising and why the NPAT numbers the company was quoting may well be far from sustainable or recurring. Presumably the issues with Foundation did not occur overnight so why wasn't the valuation reduced to closer to fair value over time?

Unless and until a full independent review of all of their valuations is completed, it will be very hard to determine the intrinsic value of this business.