The State of Washington’s Department of Financial Institutions recently sent out a memo to investment advisors registered in Washington that described potential updates, amendments, and additions to Washington’s investment advisor rules and regulations. Amendments to the custody requirements and an exemption for private fund advisors are the major provisions included in the memo, but the Washington Department of Financial Institutions also proposed changes for financial reporting, books and records, unethical practices, proxy voting, advisory contracts, and compliance procedures. You can access a copy of the draft amendments here.
Category Archives: Books Records
Complimentary Books and Records Documentation List
March 30, 2012
RIA Compliance Consultants encourages you to view our firm’s Facebook page to receive your complimentary sample Books and Records Documentation List. Our sample Books and Records Documentation List can serve as a log and a checklist to help your investment advisor make sure that it is properly maintaining required books and records. It can also be used as an internal auditing tool to help with proper storage of important documentation. Investment advisors may be overwhelmed by the amount of information and number of documents that must be maintained to meet the minimum books and records requirements; RIA Compliance Consultants encourages your investment advisor to utilize this Books and Records Documentation List to foster increased organization and proper storing practices.
An Investment Advisor Should Test Periodically Whether It Is Maintaining the Required Books & Records
March 29, 2012
A registered investment advisor is required to make and keep true, accurate and current certain books and records relating to its investment advisory business. For investment advisors registered with the U.S. Securities and Exchange Commission (SEC), these required books and records are outlined in Rule 204-2 of the Investment Advisers Act of 1940 (“Advisers Act”). Each investment advisor registered with the SEC should familiarize itself with the requirements of this rule in relation to the documents and reports that need to be maintained, where and for how long the documents must be maintained, and how the documents may be maintained. Most books and records requirements for state registered investment advisors are the same as or similar to the SEC requirements, but each investment advisor needs to make sure that it familiarizes itself with the requirements of the appropriate governing authority.
By now, registered investment advisors affected by the changes to Rule 203A-5 under the Investment Advisers Act of 1940 (“Rule 203A-5”), mid-sized investment advisor firms (firms with assets under management between $25 million and $100 million), should have begun the process of switching from registration with the U.S. Securities and Exchange Commission (“SEC”) to state registration. Mid-sized advisor firms making the switch must keep in mind that filing the Form ADV Part 1 amendment and submitting an application for registration with the appropriate state regulatory agencies is just the first step in the process of making the switch from SEC to state registration. A registered investment advisor must familiarize itself with the regulatory requirements of the SEC or state securities regulators, as applicable, and make sure that appropriate procedures are in place for complying with these requirements. For a mid-sized advisor this will mean reviewing and making sure that it is complying with the appropriate state rules and regulations versus those of the SEC.
Investment Advisers Should Expect More Frequent Regulatory Exams
September 13, 2011
With the upcoming regulatory switch of mid-sized investment advisers from the U.S. Securities and Exchange Commission (“SEC”) to state securities regulators and Congress considering whether to authorize a self-regulatory organization (“SRO”) for investment advisers, we believe that the frequency of investment adviser examinations is going to rise.
Maintaining Investment Advisor Books and Records
July 12, 2011
A registered investment advisor is required to make and keep true, accurate, and current certain books and records relating to its investment advisory business. For investment advisors registered with the U.S. Securities and Exchange Commission (“SEC”), these required books and records are outlined in Rule 204-2 of the Investment Advisers Act of 1940 (“Advisers Act”). Each investment advisor registered with the SEC should familiarize itself with the requirements of Rule 204-2 in relation to the documents and reports that need to be maintained, where and for how long the documents must be maintained, and how the documents may be maintained. Most books and records requirements for state registered investment advisors are the same as or similar to the SEC requirements, but you need to make sure that you familiarize yourself with the requirements of the appropriate regulatory authority for your investment advisor.
An Investment Advisor Should Test Periodically Whether It Is Maintaining The Required Books & Records
July 06, 2010
A registered investment advisor is required to make and keep true accurate and current certain books and records relating to its investment advisory business. For investment advisors registered with the U.S. Securities and Exchange Commission (SEC), these required books and records are outlined in Rule 204-2 of the Investment Advisers Act of 1940 (“Advisers Act”). Each investment advisor registered with the SEC should familiarize itself with the requirements of this rule in relation to the documents and reports that need to be maintained, where and for how long the documents must be maintained, and how the documents may be maintained. Most books and records requirements for state registered investment advisors are the same as or similar to the SEC requirements, but you need to make sure that you familiarize yourself with the requirements of the appropriate governing authority.
Section 31(a) of the Investment Company Act of 1940 (“ Investment Company Act”) requires that each registered investment adviser “maintain and preserve” records of accounts, correspondence, memorandums, tapes, discs, papers, books, and other documents or transcribed information. These books and records are to be maintained for a period of five years and are subject to random periodic inspection by the U.S. Securities and Exchange Commission (“SEC”). Likewise, under Rule 204-2 of the Investment Advisers Act of 1940 (“Investment Advisers Act”), the SEC requires certain books and records to be maintained by a registered investment adviser regardless of whether of the investment adviser is associated with a registered investment company.
