(a) every investment adviser registered or required to be registered under section 203 of the act (15 u.s.c. 80b-3) shall make and keep true, accurate and up-to-date the following books and records related to their advisory business of investments;
(1) a journal or journals, including cash receipts and disbursements, registers, and any other records of the original entry that form the basis of entries in any ledger.
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(2) general and subsidiary ledgers (or other comparable records) reflecting the accounts of assets, liabilities, reserves, capital, income and expenses.
(3) a memorandum of each order given by the investment adviser for the purchase or sale of any security, of any instruction received by the investment adviser with respect to the purchase, sale, receipt or delivery of a security in particular, and of any modification or cancellation of said order or instruction. said memorandums must show the terms and conditions of the order, instruction, modification or cancellation; identify the person related to the investment adviser who recommended the transaction to the client and the person who placed such order; and the account by which it was entered, the date of entry, and the bank, broker or intermediary by or through whom it was executed in your case will be stated. orders issued pursuant to the exercise of discretionary power shall be so designated.
(4) all check stubs, bank statements, canceled checks, and cash reconciliations from the investment adviser.
(5) all invoices or statements (or copies thereof), paid or unpaid, relating to the investment adviser’s business as such.
(6) all trial balances, financial statements, and internal audit working papers relating to the business of such investment adviser.
(7) originals of all written communications received and copies of all written communications sent by said investment adviser in connection with:
(i) any recommendations made or proposed to be made and any advice given or proposed to be given;
(ii) any receipt, disbursement or delivery of funds or securities;
(iii) the placement or execution of any order to buy or sell securities;
(iv) past performance (as defined in § 275.206(4)-1(e)(12) of this chapter) and the performance or rate of return on any or all managed accounts, portfolios (as defined in § 275.206 (4)-1(e)(11) of this chapter), or recommended values; provided, however:
(a) that the investment adviser shall not be required to retain unsolicited market letters and other similar communications for general public distribution not prepared by or for the investment adviser; and
(b) that if the investment adviser sends any notice, circular or other announcement (as defined in § 275.206(4)-1(e)(1) of this chapter) offering any report, analysis, publication or other investment advisory service to more than ten persons, the investment adviser shall not be required to keep a record of the names and addresses of the persons to whom it was sent; except that if such notice, circular or announcement is distributed to persons named on any list, the Investment Adviser will retain with a copy of such notice, circular or announcement a memorandum describing the list and the source thereof.
(8) a list or other record of all accounts in which the investment adviser has discretionary powers with respect to the funds, securities or transactions of any client.
(9) all powers of attorney and other evidence of the grant of any discretionary authority by any client to the investment adviser, or copies thereof.
(10) all written agreements (or copies thereof) entered into by the investment adviser with any client or otherwise relating to such investment adviser’s business as such.
(11)
(i) one copy of each
(a) advertising (as defined in § 275.206(4)-1(e)(1) of this chapter) that the investment adviser disseminates, directly or indirectly, except:
(1) for oral announcements, the advisor may retain a copy of any written or recorded material used by the advisor in connection with the oral announcement; and
(2) for endorsements and compensated oral testimony (as defined in § 275.206(4)-1(e)(17) and (5) of this chapter), the assessor may instead make and hold a record of the disclosures provided to clients or investors pursuant to § 275.206(4)-1(b)(1) of this chapter; and
(b) notice, circular, newspaper article, investment letter, newsletter, or other communication that the investment adviser disseminates, directly or indirectly, to ten or more persons (other than persons associated with such investment adviser) ; and
(c) if such notice, circular, advertisement, newspaper article, investment letter, newsletter or other communication recommends the purchase or sale of a specific security and does not state the reasons for such recommendation, a memorandum from the investment adviser indicating the reasons for it; and
(ii) a copy of any questionnaire or survey used in the preparation of a third party rating included or appearing in any advertisement in the event that the assessor obtains a copy of the questionnaire or survey.
(12)
(i) a copy of the investment adviser’s code of ethics adopted and implemented pursuant to § 275.204a-1 that is current, or has been current at any time within the last five years;
(ii) a record of any violation of the code of ethics and any action taken as a result of the violation; and
(iii) a record of all written acknowledgments as required by § 275.204a-1(a)(5) for each person who is currently, or has been in the last five years, a person supervised by the investment adviser.
(13)
(i) a record of each report made by an access person as required by § 275.204a-1(b), including any information provided under paragraph (b)(3)(iii) of that section in place of said reports;
(ii) a record of the names of persons who are currently, or have been in the last five years, access persons for the investment adviser; and
(iii) a record of any decision, and the reasons supporting the decision, to approve the acquisition of securities by access persons under § 275.204a-1(c), for at least five years after the end of the year fiscal in which the approval is granted.
(14)
(i) a copy of each prospectus, prospectus supplement, and form crs, and each amendment or revision to the prospectus, prospectus supplement, and form crs, that satisfies the requirements of part 2 or part 3 of form adv, as applicable [17 cfr 279.1]; any summary of material changes that satisfies the requirements of adv form part 2 but is not included in the prospectus; and a record of the dates each prospectus, prospectus supplement, and form, each amendment or revision thereto, and each summary of material changes not contained in a prospectus delivered to any customer or any potential customer who subsequently becomes a customer.
(ii) documentation describing the method used to calculate assets under management for the purposes of item 4.e of part 2a of adv form, if the method differs from the method used to calculate regulated assets under management in item 5.f of part 1a of form adv.
(iii) a memorandum describing any legal or disciplinary event listed in item 9 of part 2a or item 3 of part 2b (disciplinary information) and presumed to be material, if the event involved the investment adviser or any of their supervised persons and is not disclosed in the prospectus or prospectus supplement described in paragraph (a)(14)(i) of this section. The memorandum must explain the investment adviser’s determination that the presumption of materiality is exceeded and must discuss the factors described in item 9 of part 2a of the adv form or item 3 of part 2b of the adv form.
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(15)
(i) if not included in the announcement, a record of the disclosures provided to clients or investors pursuant to § 275.206(4)-1(b)(1)(ii) and (iii) of this chapter;
(ii) documentation substantiating the assessor’s reasonable basis for believing that a testimonial or endorsement (as defined in § 275.206(4)-1(e)(17) and (5) of this chapter) complies with § 275.206(4) )-1 and that third-party qualification (as defined in § 275.206(4)-1(e)(18) of this chapter) complies with § 275.206(4)-1(c)(1) of this chapter; and
(iii) a record of the names of all persons who are partners, officers, directors, or employees of an investment adviser, or a person who controls, is controlled by, or is under common control with the investment adviser , or is a partner, officer, director, or employee of such person pursuant to § 275.206(4)-1(b)(4)(ii) of this chapter.
(16) all accounts, books, internal working papers, and any other records or documents that are necessary to form the basis of or demonstrate the calculation of any return or rate of return on any or all managed accounts, portfolios ( as defined in § 275.206(4)-1(e)(11) of this chapter), or recommendations of values presented in any notice, circular, announcement (as defined in § 275.206(4)-1(e)(1 ) of this chapter), newspaper article, investment letter, newsletter, or other communication that the investment adviser disseminates, directly or indirectly, to any person (other than persons associated with such investment adviser), including copies of all information provided or offered pursuant to § 275.206 (4)-1(d)(6) of this chapter; provided, however, with respect to the performance of managed accounts, the retention of all account statements, if they reflect all debits, credits, and other transactions to a customer’s or investor’s account during the account statement period, and all worksheets necessary to demonstrate the calculation of the return or rate of return for all managed accounts will be deemed to satisfy the requirements of this paragraph.
(17)
(i) a copy of the investment adviser’s policies and procedures formulated pursuant to § 275.206(4)-7(a) of this chapter that are in effect, or have been in effect at any time within the last five years;
(ii) any record documenting the investment adviser’s annual review of such policies and procedures conducted pursuant to § 275.206(4)-7(b) of this chapter;
(iii) a copy of any internal control report obtained or received pursuant to § 275.206(4)-2(a)(6)(ii).
(18)
(i) books and records related to § 275.206(4)-5 that contain a list or other record of:
(a) the names, titles, and business and residential addresses of all covered associates of the investment adviser;
(b) all government entities to which the investment adviser provides or has provided investment advisory services, or that are or were investors in any covered investment group to which the investment adviser provides or has provided services of investment advice, as applicable, in the last five years, but not before September 13, 2010;
(c) all direct or indirect contributions made by the investment adviser or any of its covered associates to an official of a government entity, or direct or indirect payments to a political party of a state or political subdivision thereof, or to a political action committee; and
(d) the name and business address of each regulated person to whom the investment adviser provides or arranges to provide, directly or indirectly, a payment to solicit a governmental entity for investment advisory services on its behalf, of pursuant to § 275.206(4)-5(a)(2).
(ii) the records related to the contributions and payments mentioned in paragraph (a)(18)(i)(c) of this section must be listed in chronological order and indicate:
(a) the name and position of each taxpayer;
(b) the name and title (including any city/county/state or other political subdivision) of each recipient of a contribution or payment;
(c) the amount and date of each contribution or payment; and
(d) if such contribution was subject to the exception for certain returned contributions pursuant to § 275.206(4)-5(b)(2).
(iii) An investment adviser is only required to make and maintain the records referred to in paragraphs (a)(18)(i)(a) and (c) of this section if it provides investment advice services. to a government entity or a government entity is an investor in any covered investment fund to which the investment adviser provides investment advisory services.
(iv) For the purposes of this section, the terms “contribution”, “covered associate”, “covered investment group”, “government entity”, “official”, “payment”, “regulated person” and ” request” have the same meanings as set forth in § 275.206(4)-5.
(19) A record of who is the “intended audience” pursuant to § 275.206(4)-1(d)(6) and(e)(10)(ii)(b) of this chapter.
(b) If an investment adviser subject to paragraph (a) of this section has custody or possession of securities or funds of any client, the records required to be made and maintained under paragraph (a) of this section shall include :
(1) a journal or other record showing all purchases, sales, receipts, and deliveries of securities (including certificate numbers) for such accounts and all other debits and credits to such accounts.
(2) a separate ledger account for each customer showing all purchases, sales, receipts, and deliveries of securities, the date and price of each purchase and sale, and all debits and credits.
(3) copies of confirmations of all transactions made by or on behalf of said client.
(4) a record for each security in which said client has a position, said record shall show the name of each client who has any interest in said security, the amount or interest of each of said clients and the location of each of those securities.
(5) a memorandum describing the basis on which it has determined that the presumption that any related person is not operationally independent under § 275.206(4)-2(d)(5) has been overcome ).
(c)
(1) any investment adviser subject to paragraph (a) of this section who provides any investment monitoring or management service to any client shall, with respect to the monitored or managed portfolio and to the extent the information is reasonably available to or obtainable by the investment adviser, make and maintain true, accurate and current:
(i) records showing separately for each customer the securities purchased and sold, and the date, amount and price of each purchase and sale.
(ii) for each security in which such client has a current position, information from which the investment adviser can promptly provide the name of each such client and the current amount or interest of such client.
(2) any investment adviser subject to paragraph (a) of this section who exercises voting authority with respect to securities of clients shall, with respect to those clients, do and retain the following:
(i) Copies of all policies and procedures required by § 275.206(4)-6.
(ii) a copy of each proxy statement received by the investment adviser with respect to client securities. An investment adviser may satisfy this requirement by relying on a third party to make and maintain, on behalf of the investment adviser, a copy of a proxy statement (provided the adviser has obtained an undertaking from the third party to provide a copy of the proxy statement). representation). statement promptly upon request) or you may rely on obtaining a copy of a proxy statement from the commission’s electronic data collection, analysis, and retrieval (EDGAR) system.
(iii) a record of each vote cast by the investment adviser on behalf of a client. An investment adviser may satisfy this requirement by relying on a third party to make and maintain, on behalf of the investment adviser, a record of the vote cast (provided the adviser has obtained an undertaking from the third party to provide a copy of the record promptly upon request). .
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(iv) a copy of any document created by the advisor that was material to making a decision about how to vote by proxy on behalf of a client or that memorializes the basis for that decision.
(v) a copy of each client’s written request for information about how the adviser voted by proxy on behalf of the client, and a copy of any investment adviser’s written response to any request (written or oral) from the client of information on how the advisor voted proxies on behalf of the requesting client.
(d) any book or record required by this section may be maintained by the investment adviser in such a manner that the identity of any client to whom the investment adviser provides investment oversight services is indicated by a numerical code or alphabetical or some similar designation.
(e)
(1) all books and records required under the provisions of paragraphs (a) through (c)(1)(i), inclusive, and (c)(2) of this section (except books and records required to be performed under the provisions of paragraphs (a)(11), (a)(12)(i), (a)(12)(iii), (a)(13)(ii), (a) ( 13)(iii), (a)(16) and (a)(17)(i) of this section), must be maintained and preserved in an easily accessible place for a period of not less than five years from the final of the fiscal year during which the last entry in said register was made, the first two years in an appropriate office of the investment adviser.
(2) the articles of the company and any amendments thereto, articles of incorporation, bylaws, minute books and stock certificate books of the investment adviser and any predecessor, shall be maintained at the principal office of the adviser of investments and will be kept until at least three years after the termination of the company.
(3)
(i) the books and records that must be kept in accordance with the provisions of paragraphs (a)(11) and (a)(16) of this rule will be kept and preserved in an easily accessible place for a period not less than five years, the first two years in an appropriate office of the investment adviser, from the end of the fiscal year during which the investment adviser last published or disseminated, directly or indirectly, the notice, circular, announcement, newspaper article, letter, newsletter or other communication.
(ii) transition rule. if you are an investment adviser who, prior to July 21, 2011, was exempt from registration under section 203(b)(3) of the Act (15 u.s.c. 80b-3(b)(3)), applicable effective July 20, 2011, paragraph (e)(3)(i) of this section does not require you to maintain or retain books and records that you would otherwise be required to maintain or retain under the provisions of paragraph (a)(16) of this section to the extent that those books and records relate to the return or rate of return of such private fund (as defined in section 202(a)(29) of the act (15 u.s.c. 80b-2(a)(29)), or other account you indicate for any period ending prior to your registration, provided that you continue to retain all books and records in your possession relating to the performance or rate of return of such private fund or other account during said period.
(f) An investment adviser subject to paragraph (a) of this section, before ceasing to carry on or discontinuing business as an investment adviser, shall organize and be responsible for the maintenance of the books and records that must be kept and be retained under this section for the remainder of the period specified in this section, and shall notify the commission in writing, at its principal office, washington, d.c. 20549, of the exact address where said books and records will be kept during said period.
(g) micrographic and electronic storage allowed –
(1) general. Records required to be maintained and retained pursuant to this part may be maintained and retained for as long as required by an investment adviser at:
(i) micrographic media, including microfilm, microfiche, or any similar media; or
(ii) electronic storage media, including any digital storage media or system that meets the terms of this section.
(2) general requirements. the investment adviser must:
(i) organize and index the records in a manner that allows easy location, access and retrieval of any particular record;
(ii) promptly provide any of the following that the commission (by its examiners or other representatives) may request:
(a) a legible, true and complete copy of the record in the medium and format in which it is stored;
(b) a legible, true and complete hard copy of the record; and
(c) means to access, view and print the records; and
(iii) store separately, for the time required to preserve the original record, a duplicate copy of the record in any medium permitted by this section.
(3) special requirements for electronic storage media. in the case of records on electronic storage media, the investment adviser must establish and maintain procedures:
(i) to maintain and preserve the records, in order to reasonably safeguard them from loss, alteration or destruction;
(ii) limit access to records to duly authorized personnel and the commission (including its examiners and other representatives); and
(iii) to reasonably ensure that any reproduction of an original non-electronic record on an electronic storage medium is complete, true, and legible when retrieved.
(h)
(1) any book or other record made, kept, maintained and preserved pursuant to §§ 240.17a-3 and 240.17a-4 of this chapter under the securities exchange act of 1934, or rules adopted by the municipality the securities regulatory board, which is substantially the same as the book or other record that is required to be made, maintained, maintained and preserved pursuant to this section, shall be deemed to be made, maintained, maintained and preserved pursuant to this section .
(2) a record made and maintained pursuant to any provision of paragraph (a) of this section, containing all information required under any other provision of paragraph (a) of this section, need not be maintained in duplicate in to meet the requirements of the other provision of paragraph (a) of this section.
(i) As used in this section, the term “discretionary power” shall not include discretion as to the price or the time a transaction is made or will be made, if, before the investment gives the advisory order, the client has directed or approved the purchase or sale of a defined quantity of the particular security.
(j)
(1) Except as provided in paragraph (j)(3) of this section, each nonresident investment adviser registered or applying for registration pursuant to section 203 of the act shall retain, maintain and preserve, at a place within the United States designated in a notice from him as provided in paragraph (j)(2) of this section true, correct, complete, and current copies of books and records that he must make, keep current, maintain or preserve in accordance with any provisions of any rule or regulation of the commission adopted under the law.
(2) Except as provided in paragraph (j)(3) of this section, each nonresident investment adviser subject to this paragraph (j) shall provide the commission with written notice specifying the address of the place within from United States. where the copies of the books and records that must be kept and kept in accordance with paragraph (j)(1) of this section are located. each nonresident investment adviser registered or applying for registration when this paragraph becomes effective must file such notice within 30 days after such rule becomes effective. each nonresident investment adviser who files an application for registration after this paragraph becomes effective shall file such notice with such application for registration.
(3) Notwithstanding the provisions of paragraphs (j)(1) and (2) of this section, a nonresident investment adviser need not keep or retain within the United States copies of the books and records referred to in that section. paragraphs (j)(1) and (2), if:
(i) such nonresident investment adviser files with the commission, at the time or within the period provided in paragraph (j)(2) of this section, a written commitment, in a format acceptable to the commission and signed by a person duly authorized, to furnish to the commission, upon request, at its principal office in washington, dc, or at any regional office of the commission designated in said request, true, correct, complete, and current copies of any or all books and records that you are required to make, keep up to date, maintain or preserve in accordance with any provision of any rule or regulation of the commission adopted by virtue of the act, or any part of such books and records that may be specified in said lawsuit . said commitment will be substantially as follows:
(ii) such nonresident investment adviser provides to the commission, at his expense, 14 days after a written request is sent to him by certified mail at his last address on record filed with the commission and signed by the secretary of the commission or such person as the commission authorizes to act on its behalf, true, correct, complete and current copies of any and all books and records that such investment adviser is required to make, keep up to date or preserve in accordance with any provision of any rule or regulation of the commission adopted by virtue of law, or any part of such books and records as may be specified in such written demand. Said copies shall be delivered to the Commission at its main office in Washington, DC, or at any regional office of the Commission specified in said written request.
(4) For purposes of this rule, the term nonresident investment adviser shall have the meaning set forth in § 275.0-2(d)(3) of the act.
(k) any investment adviser who registers under section 203 of the act (15 u.s.c. 80b-3) after July 8, 1997 must keep in accordance with this section the books and records that the investment adviser investments was required to be maintained by the state in which the investment adviser had its principal office and place of business prior to registering with the commission.
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