A SEC registered investment adviser’s supervised persons includes any employees, partners, officers, directors (or other persons occupying a similar status or performing similar functions) as well as any other persons that provide advice on the investment adviser’s behalf and are subject to the investment adviser’s supervision and control.
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SEC Rule 204A-1 requires a SEC registered investment adviser’s code of ethics to set forth the standards of business conduct expected of the investment adviser’s “supervised persons” and it must address personal securities trading (“PST”) by such individuals. A SEC registered investment adviser is not required to adopt a particular standard of business ethics. Rather, the standard that an investment adviser selects should reflect the investment adviser’s fiduciary obligations to its investment advisory clients and the fiduciary obligations of the individuals it supervises and require compliance with the federal securities laws. A code of ethics should set out ideals for ethical conduct premised on fundamental principals of openness, integrity, honesty and trust. A good code of ethics should effectively convey to investment adviser representatives and employees the value that the investment adviser places on ethical conduct, and the code of ethics should challenge the investment adviser representatives and employees to meet not only the letter of the law, but also the ideals of the investment adviser. An investment adviser may set higher ethical standards than the requirements set under federal securities laws.
This will vary among state securities regulators depending on the state securities regulator’s investment advisor rules and regulations. It is important for a state registered investment adviser to remember that the regulations of many state securities regulators follow the SEC’s rules for SEC registered investment advisers. Therefore, many state registered investment advisers may also be required to adopt a code of ethics similar to the SEC requirements. A state registered investment adviser will need to consult the investment adviser rules and regulations of its state securities regulator(s) to determine if this is required.
SEC Rule 204A-1 issued under the Investment Advisers Act of 1940 requires all SEC registered investment advisers to adopt a code of ethics.
What are the fees associated with filing Form PF?
November 02, 2018
Filing fees are charged by FINRA to use the IARD system. The filing fees for SEC-registered investment advisers filing Form PF using the IARD system are $150 for each annual report and $150 for each quarterly report.
How do you file Form PF?
November 02, 2018
Form PF must be filed electronically through the Form PF filing system on the Investment Adviser Registration Depository (IARD) website.
What are the compliance dates for Form PF?
November 02, 2018
For currently registered investment advisers and firms that register as investment advisers in 2012, Form PF has a two-stage period for filing.
When does Form PF have to be updated?
November 02, 2018
“Small” and “large” private equity fund advisers must file Form PF annually within 120 days after the end of their fiscal year. They must respond to questions focusing primarily on the extent of leverage incurred by their funds’ portfolio companies, the use of bridge financing, and their funds’ investments in financial institutions.
Advisers that have at least $150 million in private fund assets under management but that do not exceed a “large adviser” threshold must file Form PF only once a year. These “small” private fund advisers are required to fill out basic information on the private funds they advise. This includes limited information regarding size, leverage, investor types and concentration, liquidity, and fund performance. The “smaller advisers” managing hedge funds must also report basic hedge fund information. This includes fund strategy, counterparty credit risk, and use of trading and clearing mechanisms.
Who is required to file Form PF?
November 02, 2018
Investment advisers must file a Form PF if registered or required to register with the SEC as an investment adviser; or if registered or required to register with the U.S. Commodity Future Trading Commission (CFTC) as a CPO or CTA and also registered or required to register with the SEC as an investment adviser; and manage one or more private funds; and the investment adviser and its related persons, collectively, had at least $150 million in private fund assets under management as of the last day of its most recently completed fiscal year. The due date for Form PF varies depending on the classification and size of the investment adviser. Many private fund advisers meeting these criteria will be considered a “small” adviser and be required to complete only Section 1 of Form PF and will need to file only on an annual basis. Large private fund advisers, however, will be required to provide additional data, and large hedge fund advisers and large liquidity fund advisers will need to file every quarter.
