The compliance teams are already deep in the ten principles. The compliance teams are already deep in the ten principles. That's reasonably straightforward.

ASIC says the sector is hitting its first real test. Liquidity is tighter, borrowers are showing stress, and credit is starting to deteriorate. These funds grew fast. Now they have to hold up under scrutiny.

The people who write loans in a good market are not always the ones you want valuing them in a bad one. I have placed both over the years. They are different hires.

Writing a book rewards pace and conviction. Working one out rewards patience and a willingness to mark something down and then defend it in the room. Most people are good at one, not both.

So when companies sit down this reporting season, the real question isn't the model. It's whether anyone in the room has managed a loan through a downturn and knows what one looks like when the borrower stops paying.

The funds asking now will be in better shape than those asking after a bad quarter.

The harder question is who actually does the valuing when a book goes bad.