When I am working with a client to register their new investment advisor firm, one of the important documents that I customize for the firm is a Compliance Manual. This document, sometimes referred to as Written Supervisory Procedures, is a document that outlines all the books and records requirements that a new advisory firm must comply. It addresses how you will operate your new firm and discusses how your firm will comply with the federal and state rules, as they apply to your business model.
Often, I hear that regulators find investment advisory firms that purchase an ‘off the shelf’ document meaning that the firm has not taken the time to customize the document to how the firm operates. Your Compliance Manual should be a ‘living and breathing’ document that mirrors how your firm actually operates at all times.
Over the years, I have worked with firms that have subscribed to the ‘off the shelf’ method. These are the advisors that call saying ‘the regulators are coming in tomorrow can you customize a Compliance Manual for me?’ Unfortunately, it does not work that way. This is a document that registered investment advisors really need to put some thought into at point of creation and on an ongoing basis.
If you find yourself in the position of having an ‘off the shelf’ document in your office, contact Registered Advisor Services today for assistance before the regulators are knocking on your door!
