Valuation, harvest and accrual reporting

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Choose the evidence

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The 2-track settlement model

1. Track 1: On-Chain Data API (Gross Yield):
   • Reflects pure, unadulterated on-chain vault operations.
   • Provides canonical Gross PnL, holdings, and time-weighted returns.
   • Serves as the immutable single source of truth for corporate balance sheet valuation and financial audits.
2. Track 2: Commercial Settlement Statement (Net Payout):
   • Off-chain commercial calculation applied to the API Gross PnL.
   • Applies agreed contractual terms: performance fee sharing (e.g. 10% fee with 50~70% partner share) and deductions for off-chain expenses (such as monthly Rhino bridge invoices).
   • Produced as a monthly settlement statement for cash disbursement.

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Strategy NAV estimate

Estimated Total Assets        = Root Reported Assets - Reported Strategy Debt + Sum(Strategy Estimated Assets)
Estimated Total Value         = floor(Held Shares * Estimated Total Assets / Total Supply) (converted) + Redemption Receivables
Estimated PnL                 = Ending Estimated Total Value - Beginning Estimated Total Value - (Inflows - Outflows)

• Same-block reads: NAV estimation uses exact same-block queries across all underlying venue adapters.
• Availability with flows: True TWR under estimated NAV supports periods without external cash flows. If an external flow occurs during the period, NAV return rates are returned as null with twr_nav_flow_state_unavailable, while monetary cash flows and estimated PnL remain available.
• Cost basis preservation: Setting valuation=estimated_nav revalues positionValue and unrealizedPnl, but retains the exact same historical costBasis.

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Harvest to investor earnings

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Two realization measures

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Cooldown principal and settlement

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Example across three periods

• When the harvest occurs, profit is fully locked; investor PnL is 0.
• Over the 7-day degradation window, profit unlocks; investor recognizes +10 in unrealized PnL.
• When shares are redeemed, the +10 unrealized gain shifts into +10 realized PnL; net PnL is 0.

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Why legacy harvestReport is retired in v1

1. No Legal Entitlement or Liquidity at Report Time (IFRS Asset Recognition Failure):
   • Under smart contract mechanics, profit reported by a harvest is locked in a degradation buffer and released linearly over 7 days.
   • If an investor redeems shares immediately after harvest, the contract settles strictly at pricePerShare (using freeFunds), completely excluding unreleased locked profit.
   • Recording an unredeemable locked amount as current holder balance or PnL violates the IFRS definition of an asset (present economic control and expected realizable inflow).
2. Shareholding Dilution and Flow Mismatch:
   • Assuming locked profit belongs to current holders requires assuming zero subsequent deposits or withdrawals over the next 7 days.
   • If new depositors enter the vault on day 2, they acquire shares at the current PPS, and the remaining locked profit unlocks across the enlarged share supply. Current holders are diluted.
   • Recognizing 100% of the locked profit on day 1 produces phantom gains that change retrospectively when other participants transact.
3. Breakage of the Lifetime Ledger Invariant:
   • Any compliant accounting ledger must satisfy:
     Cumulative Lifetime PnL = Closing Total Value + Total Withdrawn - Total Deposited
     
   • Because all deposits and redemptions execute in real tokens at PPS, booking locked profit in balance/earnings causes a sharp artificial disposal loss when an investor exits at actual PPS.

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How to query the information you need

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Boundary valuation equation

Released Profit         = floor(min(Elapsed Seconds * Degradation Rate, 10^18) * Stored Locked Profit / 10^18)
Effective Locked Profit = Stored Locked Profit - Released Profit

Free Funds            = Reported Total Assets - Effective Locked Profit
Active Position Value = floor(Held Shares * Free Funds / Total Supply) (converted)
Total Value           = Active Position Value + Redemption Receivables

Reported Position Value = Active Position Value + Allocated Locked Profit + Rounding Adjustment

• Allocated Locked Profit: floor(Held Shares * Effective Locked Profit / Total Supply) (converted).
• Rounding Adjustment: Integer floor difference between the converted reported allocation (floor(Held Shares * Reported Total Assets / Total Supply) (converted)) and the sum of active position value and allocated locked profit.

[!NOTE] Valuation mode vs reconciliation evidence: The Data API supports exactly two valuation modes: valuation=pps (default canonical share value) and valuation=estimated_nav (real-time underlying venue accruals). include=reconciliation is not an independent valuation mode; it is an enrichment parameter available exclusively with valuation=pps that supplies audit evidence reconciling the difference between canonical PPS valuation and total reported assets (including the locked profit buffer and integer rounding differences).

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Harvest allocation

Wallet Harvest Allocation = floor(Wallet Shares * Net Report Gain / Total Supply) (converted)

• Net report gain: Gross report gain minus gross report loss in underlying token atoms (signed integer division truncates toward zero before conversion).
• Report-block ownership: Wallet shares and total supply measured after all transactions in the report block.
• Assessed fees: Fees equal min(Gross Gain, Management Fee + Performance Fee + Strategist Fee); zero gain charges zero.

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Period-close workflow

[!TIP] Practical Walkthrough: For an end-to-end walkthrough with live curl requests, actual response payloads, and ledger journal entries, see the Partner Reconciliation Walkthrough.

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Additional recognition and measurement

Adjusted Balance = Ledger Balance + Carrying Adjustment
Adjusted PnL     = Ledger PnL + (Ending Adjustment - Beginning Adjustment)