1. Investment Adviser Workshop: the New Form ADV Part 2, New Rules, and the IA Switch

2. Utah Rule Amendments Chip Lyons Analyst

3. Amended Utah Rules Electronic Filing Mandatory Electronic Filing Mandatory New Form ADV Part 2 Adopted New Form ADV Part 2 Adopted Formalized Division Notification: Formalized Division Notification: Designated Official Designated Official Custody / Discretion Custody / Discretion Proof of Bond, if required Proof of Bond, if required IA Filing Requirements

4. Amended Utah Rules Renewals – no new requirements Renewals – no new requirements Increased advanced fee amounts Increased advanced fee amounts from $500 to $1,200 from $500 to $1,200 Housekeeping: NASD => FINRA Housekeeping: NASD => FINRA

5. Custody New Rule Formally Adopts the SEC’s 2010 Custody Rule 206(4)-2 SEC post-Madoff goal: SEC post-Madoff goal: safeguard investor monies. safeguard investor monies. Seamless switch for federal Seamless switch for federal covered advisers. covered advisers. Amended Utah Rules

6. Custody Two Concerns with the new rule: 1)Advisers that withdraw their fees directly from client accounts. 2)Advisers relying on the PIMS No- Action Letter. Amended Utah Rules

7. Direct Withdrawal of Fees SEC’s Kennedy No Action Letter will be rescinded by the Division. Now, deemed to have custody. Now, deemed to have custody. However, if advisers have custody However, if advisers have custody solely for the withdrawal of fees, solely for the withdrawal of fees, they are exempt from the surprise they are exempt from the surprise audit and bonding requirements. audit and bonding requirements. See R164-4-5(F)(2). See R164-4-5(F)(2). Amended Utah Rules

8. Relying on PIMS Letter Amended Utah Rules SEC’s PIMS No Action Letter will be rescinded by the Division. Applied to a few advisers managing Applied to a few advisers managing pooled funds with an independent pooled funds with an independent party controlling withdrawals. party controlling withdrawals. Now considered to have custody. Now considered to have custody. Going forward, must bond and are Going forward, must bond and are subject to all custody requirements. subject to all custody requirements.

9. Increased Filing Times For advisers with custody, the amount of time to submit audited financial statements has increased from 90 to 120 days after the adviser’s fiscal year end. Amended Utah Rules

10. Reviewing the Rules View rules on the Division’s website. View rules on the Division’s website. Public comment period ends 11/15/10. Public comment period ends 11/15/10. Soonest effective date: 11/22/10. Soonest effective date: 11/22/10. Contact the Division with any questions Contact the Division with any questions or comments. or comments. Amended Utah Rules

11. For more information, please call (801) 530-6600