Part of the mystique of private equity is that the asset class generates stellar performance. But for investors, figuring out whether that is true or not can be a headache because many of the key performance measures are subject to confusion, disagreement and downright manipulation.

Despite the massive growth of the industry and trillions invested in private equity during the past 20 years, there are no industry-wide standards for investors to measure the performance of the private equity funds they have invested in.