Annual Assessment of Written Compliance Programs

December 20, 2006

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The end of the year is a great time to complete a written review of your investment advisor firm’s compliance and procedures program. In fact, if your firm is registered with the SEC and you have not done a written analysis of your compliance program within the last 12 months, you need to complete such a review as soon as possible. While we believe that a written compliance program should be reviewed continuously and updated whenever needed, SEC registered firms are required to review and update their compliance programs at least annually. The key is to document these reviews and maintain them as part of the firm’s master books and records. Previous versions of the firm’s written policies and procedures must also be maintained under the books and records rules. Issues identified during the review must be documented and a plan of action formulated to take corrective action.

When changes are made to a compliance policy and/or procedure, employees should be made aware of the changes and required to sign off on their understanding and acknowledgement of the policies. Even if no changes are made, we suggest that all employees agree to their understanding and acknowledgement of the firm’s policies and procedures, in writing, each year.

If your firm has questions or concerns about the firm’s compliance programs annual assessment, please give us a call to discuss how we can help your firm meet its regulatory obligations.

Posted by Bryan Hill
Labels: Compliance Program