Specific retrieval information is provided. If the firm had multiple registered advisors handling client accounts, alternative communication means similar to those required for the principal advisor would be required and in place.
How will the firm handle client needs when the head of the firm becomes unavailable?
Documents called contingency plans lay out what should happen when one or more of these unexpected events occurs. She is also instructed in how to terminate the business as a registered institution, with notification to the SEC.
The plan addresses how the company responds internally to the event and real business plan documentation how it responds to the event externally. Other issues contingency plans often address are: Although each business must develop its own unique contingency plan, the following example of a contingency plan for a small independent SEC-registered financial advisory business illustrates some basic contingency plan elements.
Having alternative means available allows the firm to continue to handle client accounts in a timely way in the event of a catastrophe. The SEC also real business plan documentation that each firm has in place an alternative means of communicating with clients.
At that point, the business will cease and the clients will assume responsibility for their own accounts with a minimum of disruption. Every contingency plan answers a question about a problem.
Or, when a line of credit is unexpectedly cancelled? Every business -- large or small -- needs them. Thus, client records are stored and continuously maintained at at least four separate physical locations and on the cloud.
The Takeaway This particular contingency plan for a small registered investment advisory service provides good information about contingency plans generally: The contingency plan deals with this need in two ways: More comprehensive contingency plans likely consist of several different specific plans like the one in the example, each of them addressing a specific crisis or an unexpected event.
Every contingency plan originates as the answer to a specific question, here: It states that records of all client holdings are also maintained at the brokerage where the firm executes all trades, and that each client has unrestricted access to brokerage records.
The question is simply: In this instance, the SEC requires each Registered Investment Advisory firm to have on file plans that assure that the business can go forward and deal equitably with its client investors in the event that the head of the firm becomes unavailable through death, serious illness or accident.
There are practically an infinite number of things that can go wrong and negatively impact a business. This particular plan addresses two issues common to many contingency plans:Jun 29, · Documents called contingency plans lay out what should happen when an unexpected unexpected event occurs.
Every business must develop its own unique contingency plan. Dec 03, · Learn the 23 sections to complete in order to develop a winning business plan.Download