Post-Registration Requirements
In addition to the ongoing requirement to file the appropriate renewal forms on an annual basis, state-registered investment advisers must also meet ongoing requirements known as post-registration requirements. These requirements include:
- • Financial reports. Advisers may be required to file reports regarding their own personal and their firm’s financial condition. If the information filed on these forms becomes inaccurate at any point, updated reports must be filed as soon as possible.
- • Recordkeeping. Advisers are required to meet the recordkeeping requirements put in place by each state in which they operate.
- » According to both the USA and the Investment Advisers Act of 1940, advisers must keep virtually every form of client record and marketing literature on file for five years. This five-year period begins at the end of the fiscal year in which the record was created. Also, these records must be easily accessible for two of the five years.
- » If an adviser goes out of business, records must be kept at least an additional three years past the date of the firm’s closure.
- » A state cannot require an investment adviser to maintain any books and records in addition to those required under the laws of the state in which the adviser’s principal office is located, as long as the firm is registered and is complying with the requirements of that state.
- » The administrator is allowed to view the books and records of an investment adviser within their own state and across states to aid an investigation.
- • Audits. All registered investment advisers (RIAs) are subject to audits, also called examinations, by the states they’re licensed in at any time and for any reason that the administrator thinks is in the public interest. As part of the audit, their state administrator may examine any records they deem useful. The administrator may examine books and records of investment advisers within the