Along with updating your Form ADV Annual Amendment, it’s important to remember that many state securities regulators also require state registered investment adviser firms to submit annual financial statements and/or other documents (e.g., proof of continued coverage of a surety bond, investment advisory client agreement if material changes) directly to the state securities regulator (outside of the IARD/CRD system).
Requirements vary significantly among states – some state securities regulators require all state registered investment adviser firms filed in the state to submit an annual financial statement while other state securities regulators may only require the submission of an annual financial statement if the investment adviser firm has a principal place of business in the state, maintains investment discretion or is deemed to have custody of client assets.
These annual submissions (outside of the IARD/CRD system) of the financial statement and/or other documents to a home state securities regulator are often due within 90 days of the end of an investment adviser’s fiscal or calendar year end, however, some state securities regulators utilize a different schedule such as a December 31 deadline.
In particular, RIA Compliance Consultants is aware of the following states which require a state registered investment adviser firm to make such annual financial statement and other document submissions outside of the IARD/CRD system: Arkansas, California, Florida, Hawaii, Louisiana, Michigan, Minnesota, Nebraska, New Hampshire, New Jersey, New York, North Carolina, Oregon, Pennsylvania, Tennessee, Utah, Washington, and West Virginia.
This should not be considered an exhaustive listing of state securities regulators with such requirements. If your investment adviser firm is state registered, we recommend that you immediately review any communication that you received recently from your state securities regulator on this subject or contact your home state securities regulator to confirm whether there are any annual submissions (outside of the IARD/CRD system) such as annual financial statements due for your state registered investment adviser firm. (For investment adviser firms subscribing to RIA Compliance Consultants’ Annual Compliance Program (Bronze – Titanium packages), please check your online account with us for any shared regulatory guidance.) Once your investment adviser firm has identified the applicable requirements, you should memorialize such requirements in your compliance manual and promptly submit any required documents to your state securities regulator.
We recommend setting a calendar reminder for next year while you are at it!
The information contained in this blog post is general in nature intended for educational purposes only and is not intended to be a comprehensive analysis of this topic. RIA Compliance Consultants, Inc. has not verified the accuracy of the securities regulator’s order and is not offering any opinion whether the allegations made by the securities regulator in the administrative proceeding referenced above are accurate. This post is not intended to constitute compliance consulting advice or apply to any particular investment adviser firm’s specific situation. Please consult the applicable securities regulator’s rules and published guidance for more details about the topics referenced above. For more information about the limitations of this blog post and information on our website, please see our Disclosures webpage.