IACCP QUESTIONS WITH ACCURATE ANSWERS
What is the RAUM threshold for Registered Advisers? Accurate Answer
- $150 million
What is the RAUM range of a "Mid Sized adviser"? Accurate Answer -
$25-100 million
What two factors determine whether mid size advisers are required to
register? Accurate Answer - 1. Mid size advisers have to register if the
state where their principal office is located does NOT require registration.
2. If they are registered in a state that is NOT subject to a Exam by the State
securities administrator.
Define small adviser Accurate Answer - Advisers with $25 million or
less in assets under management
3 reasons for small advisers to register with SEC Accurate Answer - 1.
principal state does not require registration
2. state does not require any type of exam
IARD Account Accurate Answer - All states that require registration of
IAR's (RA's on CRD) which can be done in a IARD account
When is the deadline to amend form ADV? Accurate Answer - All firms
that are registered with the SEC on Jan 1st 2012 must amend their ADV by
March 30th, 2012
"buffer zone" to remain SEC registered Accurate Answer - If a firm has
assets between $90 - $110 million, then the firm is not required to switch
their registration
New rule on "private adviser exemption" Accurate Answer - an adviser
with its principal office and place of business in the U.S. is exempt from
Advisers Act registration under the Private Fund Adviser
Exemption if it: (1) acts solely as an adviser to one or more "Qualifying Private
Funds" and (2) manages private fund assets of less than $150 million
, Foreign Private Adviser Exemption Accurate Answer - Under Dodd-
Frank Act, adviser will be exempt if:
1. has no place of biz in the U.S.;
2. has fewer than 15 clients and "investors" in the U.S. in "private funds"
advised by the adviser;
3. has aggregate assets under management attributable to clients "in the US"
of less than $25 million;
4. does not hold itself out generally to the public in the US as an investment
adviser.
definition of RAUM Accurate Answer - R.egulatory A.ssets U.nder
M.anagement - under Advisers Act Section 203A(a)(2) this is when the
advisor is providing continuous and regular supervisory or mamagement
services
Four elements of "investment advice" Accurate Answer -
1. Advice about market trends
2. Advice in historical or data form
3. Advice about selecting an adviser
4. Advice about the pros and cons of securities vs. other investments
2 definitions met for RAUM Accurate Answer - (a) it has discretionary
authority over and
provides ongoing supervisory or management services with respect to the
account;
or (b) does NOT have discretionary authority over the account, but has
ongoing responsibility to select or make recommendations, based upon the
needs of the client, as to specific securities or other investments the account
may purchase or sell and, if such recommendations are accepted by the client,
is responsible for arranging or effecting the purchase or sale.
6 Exempt Institutions Accurate Answer - 1. Intrastate Advisers
2. Insurance company advisers
3. Private Fund Advisers / Foreign Advisers / VC Advisers
4. Charitable Organizations and Employees
5. Commodities Trading Advisers
6. Church Plans
What is the RAUM threshold for Registered Advisers? Accurate Answer
- $150 million
What is the RAUM range of a "Mid Sized adviser"? Accurate Answer -
$25-100 million
What two factors determine whether mid size advisers are required to
register? Accurate Answer - 1. Mid size advisers have to register if the
state where their principal office is located does NOT require registration.
2. If they are registered in a state that is NOT subject to a Exam by the State
securities administrator.
Define small adviser Accurate Answer - Advisers with $25 million or
less in assets under management
3 reasons for small advisers to register with SEC Accurate Answer - 1.
principal state does not require registration
2. state does not require any type of exam
IARD Account Accurate Answer - All states that require registration of
IAR's (RA's on CRD) which can be done in a IARD account
When is the deadline to amend form ADV? Accurate Answer - All firms
that are registered with the SEC on Jan 1st 2012 must amend their ADV by
March 30th, 2012
"buffer zone" to remain SEC registered Accurate Answer - If a firm has
assets between $90 - $110 million, then the firm is not required to switch
their registration
New rule on "private adviser exemption" Accurate Answer - an adviser
with its principal office and place of business in the U.S. is exempt from
Advisers Act registration under the Private Fund Adviser
Exemption if it: (1) acts solely as an adviser to one or more "Qualifying Private
Funds" and (2) manages private fund assets of less than $150 million
, Foreign Private Adviser Exemption Accurate Answer - Under Dodd-
Frank Act, adviser will be exempt if:
1. has no place of biz in the U.S.;
2. has fewer than 15 clients and "investors" in the U.S. in "private funds"
advised by the adviser;
3. has aggregate assets under management attributable to clients "in the US"
of less than $25 million;
4. does not hold itself out generally to the public in the US as an investment
adviser.
definition of RAUM Accurate Answer - R.egulatory A.ssets U.nder
M.anagement - under Advisers Act Section 203A(a)(2) this is when the
advisor is providing continuous and regular supervisory or mamagement
services
Four elements of "investment advice" Accurate Answer -
1. Advice about market trends
2. Advice in historical or data form
3. Advice about selecting an adviser
4. Advice about the pros and cons of securities vs. other investments
2 definitions met for RAUM Accurate Answer - (a) it has discretionary
authority over and
provides ongoing supervisory or management services with respect to the
account;
or (b) does NOT have discretionary authority over the account, but has
ongoing responsibility to select or make recommendations, based upon the
needs of the client, as to specific securities or other investments the account
may purchase or sell and, if such recommendations are accepted by the client,
is responsible for arranging or effecting the purchase or sale.
6 Exempt Institutions Accurate Answer - 1. Intrastate Advisers
2. Insurance company advisers
3. Private Fund Advisers / Foreign Advisers / VC Advisers
4. Charitable Organizations and Employees
5. Commodities Trading Advisers
6. Church Plans
