Compliance Documents Review & Gap Analysis

Focus 1 will conduct a detailed review and assessment of pertinent compliance documents, checking for:

  • compliance with regulatory requirements,
  • adherence to industry best practices, and
  • consistency among internal documents.

The documents we review include your firm’s:

  • Compliance Manual, including all related policies and procedures that may be separately documented (i.e. social media policy, etc.)
  • Code of Ethics
  • Business Continuity and Disaster Recovery Plan
  • Form ADV Part 1 and 2

Focus 1 identifies potential risk areas and/or conflicts of interest, while confirming the appropriateness of your annual review program. We provide comments and/or recommendations necessary to strengthen those areas needing improvement.  Our comments are populated directly into your documents, creating a redline version for discussion and further development.

Compliance Training

Our Compliance Training is fully customizable to meet your firm’s needs.  These recorded or live, remote training sessions cover topics of your choice and are provided at a frequency to meet your firm’s compliance training needs (e.g. quarterly, semi-annual, or annually).  The information covered can be personalized to reflect your firm’s policies and procedures on the selected topics.  We also offer follow-up quizzes to test the effectiveness of the training, as well as your employees’ comprehension.

Cybersecurity Readiness Assessment


With core areas of focus covering cybersecurity governance, risk assessment, protection, detection of unauthorized activity, and reporting, many firms have not had the time or resources to adequately go through the SEC’s sample request list and understand exactly what controls and documentation the SEC is expecting when conducting a firm-wide cybersecurity examination. In addition, many firms might not understand what a true cybersecurity program consists of and how to develop a security program that not only meets the SEC requirements but protects the firm’s sensitive information assets. O’Connor Davies and Focus 1 have partnered to help address both regulatory and low-level cybersecurity concerns to ensure the OCIE requirements are reasonably met.

What makes our approach different from other firms is:

  1. We do not partner with any software vendor such as Cisco or Microsoft.  Our suggested solutions are unbiased and based on industry experiences.
  2. We never take a one-size-fits-all approach. Each client is unique and deserves a unique assessment and unique set of associated answers.
  3. We will never recommend the fortune 500 solutions to a non-fortune 500 client. Controls need to be practical and realistic, not expensive, to be effective. We will identify how to leverage your existing technologies first before recommending any additional software solution procurements.
  4. We know the issues and what needs to be reviewed. Our approach is very direct and targeted without the “fluff” to fill the time.
  5. Most importantly, we are not just an IT and Compliance solution that doesn’t understand each area’s respective issues. We are a collaborative force that works together to ensure we offer a perspective of compliance, risk, and cybersecurity that no firm can match. Our “complete perspective” approach is what sets us apart from any traditional adviser in the cyber security and compliance space. We don’t simply talk the talk; we walk the walk.

Please contact us to schedule a complimentary call to discuss how team “O’Connor Davies/Focus 1” can perform a SEC Cybersecurity Readiness Assessment on your firm.

Marketing & Advertising Review

Focus 1 will conduct a complete review of the firm’s marketing and advertising materials to help ensure compliance with regulatory requirements, including Rule 206(4)-1 under the Advisers Act, the disclosure requirements under GIPS, and industry best practices.  Our review may include all types of presentation materials, such as pitch books, flash reports, investment commentary, newsletters, RFP’s, websites, and consultant databases.  This can be accomplished on site or remotely using our secure online Portal.
Our typical discussion with marketing and compliance personnel will include:

  • an understanding of the firm’s marketing practices;
  • the individuals involved in the firm’s marketing efforts;
  • the standard and unique materials that are used;
  • the ongoing review and approval process;
  • the context in which the materials are used;
  • how this process is tracked and the activities and materials logged;
  • the monitoring that is part of the firm’s claim of GIPS compliance; and
  • the documentation of the monitoring and review process in the firm’s compliance program

As part of this service, the following information will be referenced and made available:

  • comments and suggested changes being inserted into your documents in a redline format;
  • SEC and GIPS disclosure checklists;
  • Focus 1 testing/review sheets to include as part of your annual review; and
  • An Excel based “Compliance Program Insert” which includes the following tabs:
    • Marketing and Advertising review worksheet
    • SEC disclosure checklist
    • GIPS disclosure checklist

As an extension to this service, we can also compare to ADV Part 2 and/or RFP to ensure consistency.  Additional fees will be assessed.

SEC Exam Readiness Assessment

With today’s heightened regulatory environment, Focus 1 will underscore the value of compliance in helping to mitigate risk. We will showcase the SEC’s current Examination Priorities as part of the National Examination Program, and just as important, discuss how best to prepare for and manage an examination.

A focused discussion with compliance and senior management will include:

  • Overview of the National Examination Program
  • New initiatives and current examination priorities within the SEC’s National Examination Program
  • How to prepare and manage the examination process
  • Responding to requests and suggestions for how best to track what was provided to the examination staff
  • How to manage the exit interview and resolve any discrepancies or conflicts
  • What to consider when the exam team leaves your office
  • Review of recent regulatory correspondence (most recent SEC exam deficiency letter, if applicable)
  • Your firm’s response to an SEC deficiency letter

A Compliance Training session with an online quiz to help confirm your staffs understanding of the key concepts.

Mock interviews will be conducted, with a focus on key areas within your firm:

  •  “Entrance Interview” with senior management
  • Operations, Trading, Marketing, Client Service, Portfolio Management, and IT

In addition, Focus 1 will provide:

  • An Excel-based “Compliance Program Insert” which includes the following tab:
    • Compliance Readiness review worksheet
  • Recent SEC examination request lists (sweep, presence and full examination)
  • A recent sec examination request list, designed to provide a means of documenting who in the firm owns certain information, what system and/or report will provide the requested information, where the information is stored/archived, and any necessary lead time.

Third-Party Compliance Review

The Third-Party Compliance Review is an independent review of your firm’s annual compliance program, looking for completeness in the program, consistency across documentation, and adherence with the Investment Advisers Act of 1940 and the rules promulgated thereunder.

We perform an initial review and analysis of the information provided by your firm in order to select samples, request additional information, and identify individuals to interview while on site. This initial preparation will allow us to make more efficient use of the time spent in your office reviewing books and records. Our office visits can range from one to three days.

Subsequent to the completion of the review, we provide a report containing comments and any suggestions for strengthening your firm’s compliance manual and/or compliance controls, including practices identified as “industry best practice.”

The entire review will concentrate on those areas that the SEC has identified as the major areas of focus in the adopting statement to Rule 206(4)-7 and current focus areas, when applicable. These focus areas may include:

  • Gap analysis of firm compliance documents
  • Portfolio management processes
  • Trading practices
  • Proprietary trading of the adviser and personal trading activities of supervised persons
  • Disclosures made to investors, clients, and regulators
  • Safeguarding of client assets from conversion or inappropriate use by advisory personnel
  • Creation of required records and their maintenance, secure from unauthorized alteration, use, or destruction
  • Marketing advisory service
  • Processes to value client holdings and assess fees based on those valuations
  • Protection for the privacy of client records and information
  • Business continuity plan

For a period of up to three (3) months following the review, Focus 1 will provide consulting related to the areas covered within the review and continued access to our publications and presentations, including:

  • FOCUS resources – event driven notifications on current hot topics
  • FOCUS matters – newsletter covering RIA compliance Rules, Regulations & Best Practices; Enforcement Action Highlights; Compliance Program Tips; an Industry Perspective; and a summary of Notable Events
  • FOCUS webinars – quarterly webinar presentations on current hot topics

 

Compare to Mock SEC Exam