Waterfalls 202 – Template Explanation and Rules Calculations

The IMS Waterfall Module provides a powerful tool for users to apply simple to complex calculations found in Private Equity transactions in a consistent manner without worrying about burdensome Excel files that can add risk to your organization if not maintained properly.  This section will run through each of the Rule Templates that the system provides and items you need to consider when setting up your Waterfall.

The IMS Waterfall module currently has eight (8) predefined templates that users can pick from when setting up waterfalls.  A summary of these templates and description are found below:

Template Name

General Description

Catch Up

The Catch Up Template is designed to allow you to direct cash flow to a specific class in an amount that is based on a % that another class has already received.


Use the Custom Template to perform pro-rata calculations or scenarios not otherwise covered by the other templates.


The Fee template is designed to facilitate any type of Fee such as an Acquisition Fee or Asset Management fee due from investors in the deal or to facilitate Tax Withholdings.


The IRR Template allows the user to direct distributions to a particular class until it receives a specified IRR.

Preferred Return

The preferred return template allows the user to calculate the amount owed to investors entitled to a specified rate

Return of Capital

The Return of Capital template provides a means for paying back capital with available distributions


The Splits template allows the user to split distribution dollars between multiple classes at varying percentages.

Splits with Hurdles

The Splits with Hurdles template allows the user to split distribution dollars between multiple classes at varying percentages until one or more hurdles impacting one of the classes occurs.



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