Private equity (PE) funds are increasingly important to the economy and now serve as the primary vehicle for raising new capital. However, a limited understanding of the unique PE fund setting among accounting academics inhibits accounting research in this area. In this paper, we first describe the PE fund setting and explain how fundamental differences between PE and previously studied settings make it difficult to infer PE fund behavior from research performed using other settings. We then discuss how PE funds provide researchers with the ability to explore fundamental questions related to agency costs, governance, compensation, disclosure, and fair value accounting. Finally, we provide guidance on PE data sources available for use in future research. Because of the volume of economic activity currently funneled through PE and the unique aspects of the PE setting, it is important for researchers to explore when, why, and how accounting matters for PE funds.
Data Availability: Data used in this study are available from the public sources identified in the text.
JEL Classifications: G1; G14; G30; M4; M41.