MANAGEMENT EXPENSE Definition

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MANAGEMENT EXPENSE is the management fee deducted from a funds average net assets to pay an advisor or sub-advisor. This fee is normally on a sliding scale. As the net assets of the fund increase, the percentage deducted for management fees decreases. A fund can also have a fixed rate or flat fee to compensate the advisor.

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NET PURCHASES are those items purchased less returns, discounts and allowances on those purchases.

ORDER OF PERMANENCE is where fixed assets are entered in the balance sheet in descending order of permanence (i.e. land first, then buildings, then equipment ...).

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