Printer Friendly

AICPA supports bill to fund financial advisers regulation.

Congressman Rick Boucher (D-Va.) introduced the Investment Adviser Regulatory Enhancement and Disclosure Act (HR 578). The bill provides the Securities and Exchange Commission with additional funds for supervising investment advisers by charging the advisers an annual fee ranging from $300 to $7,000 (depending on the assets under the adviser's management). The money would be used to fund more frequent inspections of registered investment advisers.

"The bill appropriately focuses government resources on those activities having the greatest potential for fraud and abuse," said J. Thomas Higginbotham, AICPA vice-president-legislation.

Specifically, the bill requires the SEC to conduct more frequent inspections of advisers with certain risk factors, which include having custody of client funds, having authority to exercise investment discretion, being newly registered or having been found deficient during previous examinations.

Moreover, it requires investment advisers to provide prospective clients with information on their education and business backgrounds, compensation arrangements and business practices; to disclose any conflicts of interest that reasonably could be expected to impair the rendering of disinterested advice; and to provide clients with periodic written reports that include all sales commissions and fees paid by the clients.
COPYRIGHT 1993 American Institute of CPA's
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

Article Details
Printer friendly Cite/link Email Feedback
Publication:Journal of Accountancy
Article Type:Brief Article
Date:Apr 1, 1993
Words:188
Previous Article:Guarantees involving leases for land and buildings, measuring loss accruals by transferors of receivables with recourse and table funding...
Next Article:Executives question health of social security system.
Topics:


Related Articles
Financial adviser regulation alert; federal and state efforts could make it harder for many CPAs to conduct business.
AICPA testifies on draft investment advisers bill.
To register or not, that's the question.
New securities bill could streamline regulations for investment advisers.
Entering the realm of investment services.
A current focus on IA services.
Choosing an investment adviser for your firm.
Update on investment advisers regulation: the proposed IARD and compliance issues.
The mutual fund trading scandals: implications for CPAs and their clients.
How to prevent investment adviser fraud.

Terms of use | Copyright © 2016 Farlex, Inc. | Feedback | For webmasters