Does advising my own fund mean an annual audit?
RIAs · Video 4 of 8 · 0:29 ·
For SEC-registered advisers, usually yes. Advising your own fund generally means custody, and the custody rule lets a fund meet it with an audit every year by an accountant registered with and inspected by the PCAOB. Audited statements go to investors within 120 days of year end, about April 30 for a December year end, or 180 days for a fund of funds, with a final audit when the fund winds down.
Everything here is for educational purposes only and is not legal, tax or investment advice, or an offer to buy or sell any security. Laws and thresholds change and depend on your facts, so talk to a qualified attorney before acting.
Key facts
- An adviser to its own fund generally has custody of the fund's assets.
- The auditor must be registered with and inspected by the PCAOB.
- Audited financial statements go to investors within 120 days of fiscal year end.
- Funds of funds get 180 days.
- A final audit is required on liquidation.
- State-registered advisers follow their state's custody rules.
Transcript
Operator: Custody sounds like a vault. For your own fund, it usually means an audit, every year.
Founder: Every year?
Operator: Every year, by an auditor registered with, and inspected by, the PCAOB.
Operator: Say your year ends December 31.
Operator: Audited statements go to investors within 120 days. That's about April 30.
Founder: And a fund of funds?
Operator: Then you get 180 days.
Founder: And when the fund closes?
Operator: One last audit, sent out promptly once it winds down.
Founder: So... every year?