On August 25, 2016, the U.S. Securities and Exchange Commission adopted numerous substantive and technical amendments to Form ADV. While the adopting release required advisers to begin complying with the amendments as of October 1, 2017, most advisers will only be considering these changes in Q1 of 2018 as they prepare their annual ADV amendments. Some of the ADV disclosure changes are relatively simple, but others are trickier to assess.
The majority of advisers will generally need to expand their disclosure related, for example, to social media platforms used for firm business, the number of offices, and whether the firm engages an outsourced CCO. However, separate account managers will notice significantly more disclosure requirements of their separately managed accounts including information related to categories of investments, borrowings, derivative exposure, and custodians. In addition, private fund advisers should be aware that while the conditions set forth in the 2012 ABA No-Action Letter for assessing whether an adviser can use an umbrella registration have not changed, the disclosure required for relying advisers has been expanded.
There are several other clarifying and technical amendments to assess as you initiate your annual ADV update this year. As you go through the new Form ADV, feel free to reach out if you need assistance.