Although I am a seasoned New Englander, I was taken aback by last Wednesday’s snow storm. It was a race to find a proper shovel and other snow scraping apparatuses. However, as a result of the storm, I was reminded of quickly the holiday season is approaching. As usual I find myself totally unprepared for the upcoming week’s festivities. Subsequently, I began my mental list making of to do’s…and realized, I had better write them down.
As we surround ourselves with the holiday foods and office gift swaps, there is a list I would like to share with you. It is specifically important for our member firms that have a December year end and unfortunately it does not involve cookies or gift cards.
This year we have two additional requirements we need to add to our lists. The first is to verify that your auditor is a member of the PCAOB (The Public Company Accounting Oversight Board). Prior to this year, your firm was granted relief from this Sarbanes Oxley Act requirement. To check if your firm’s auditor is a member of the PCAOB, you can visit the following website, www.pcaob.com, and click on the “Registration” tab. Auditors are listed alphabetically and by location. FINRA will treat financial statements certified by an auditor who is not PCAOB-registered as not having been filed under Schedule A of the FINRA By-Laws, Section 4(g)(2)&(3). Such firms are subject to suspension under the procedures set out in FINRA Rule 9552 (Failure to Provide Information or Keep Information Current).
The second item to our list is the SIPC assessment. This assessment became effective April 1, 2009. Member firms are assessed a .25% fee on their revenues and will be required to file a semi-annual report.
- The first report is the SIPC-6 General Assessment. This applies to the first half of your fiscal year. In this instance, because the assessment only became effective April 1, 2009, the assessment technically encompassed the second quarter only. This report was due thirty days following the end of the 6 month period following a firm’s year-end. For firms with a December 31 year-end, this report was due July 30 for the period April 1, 2009 through June 30, 2009.
- The SIPC-7T Transitional Assessment form will be filed sixty days after a firm’s fiscal year end and will include revenues for the period April 1, 2009 through the fiscal year-end. Assessments paid on the SIPC-6 Form for the interim 6 month period are deducted on this form so firms are not double paying.. For members that have a December fiscal year end, your SIPC 7-T report is due March 2, 2010 and will include revenue from April 1, 2009 through December 31, 2009.
Also due March 2, 2010 is your annual audit. This begins our next list….
Here is a list we compiled of the items that auditors frequently request. We made the list – now it’s time for you to check it twice!!
As you are gathering this list, review the documents to insure accuracy and completeness.
- Copies of the firms statement of financial condition (including):
Balance sheet
Trial Balance
General Ledger for the entire fiscal year,
Statement of Profit and Loss
- Copies of Net Capital Calculations and FOCUS reports and SIPC report.
- Access to paid bills, bank statements, and payroll reports.
- Detail of legal and professional fees paid.
- Contracts with third parties
- Copies of Lease agreements, notes payable, Fidelity Bond, Expense Sharing Agreement and Clearing Agreements(if applicable), the firms most current form BD, and/or Operating Agreement.
- Schedule of fixed assets and supporting depreciation schedules. Also include any documentation relating to fixed assets purchased in the calendar year.
- Accounts Payable and Accounts Receivable Aging Schedules.
- Year-end bank reconciliation and bank statements. Bank reconciliation should have a complete list of outstanding checks with check number, date, and amount.
- Detail of deposits in transit should also be listed. (Now is a good time to review for any outstanding items)
If you have questions about your SIPC Assessment or preparing for your annual audit, please contact your FINOP or our accounting staff at 603-434-3594.
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