Broker-Dealer Notices and Reports

Broker-Dealer Notices to the Office of Broker-Dealer Finances, Division of Trading and Markets

• Broker-dealer notices to the Office of Broker-Dealer Finances should be faxed to 202-772-9273.
   
• General inquiries may be directed to the Office of Interpretation and Guidance at 202-551-5777 or by email to tradingandmarkets@sec.gov. Please include a telephone number that the Division staff can use to contact you.

Broker-Dealer Audit Reports

Broker-dealer audit reports submitted to the Commission's principal office in Washington, D.C. pursuant to Exchange Act Rule 17a-5 should be addressed to:

Securities and Exchange Commission
Registrations Branch
Mail Stop 8031
100 F Street, NE
Washington, DC 20549

Please note that Rule 17a-5(d)(6) also requires the broker-dealer to file the annual audit report at the regional or district office of the Commission for the region or district in which the broker-dealer has its principal place of business and at the principal office of the designated examining authority for the broker-dealer and to provide copies to all self-regulatory organizations of which the broker-dealer is a member.

PCAOB Registration of Broker-Dealer Auditors

The audits required under Exchange Act Section 17(e) for fiscal years ending after December 31, 2008 must be performed by an accounting firm that is registered with the Public Company Accounting Oversight Board. Broker-dealers may refer to "Division of Trading and Markets, Office of the Chief Accountant, PCAOB Registration of Auditors of Non-Public Broker-Dealers Frequently Asked Questions" at http://www.sec.gov/divisions/marketreg/faq-pcaobregbdauditors.htm.

Facing Page

The “Annual Audited Report, Form X-17A-5, Part III, Facing Page” must be completed and attached to the front of each copy of the audited financial statements.

Required Notarized Oath or Affirmation

The broker-dealer must complete the “Oath or Affirmation” on the Facing Page (or must attach the oath or affirmation to the audited financial statements in accordance with Exchange Act Rule 17a-5(e)(2)).

The oath or affirmation must be notarized.  If the broker-dealer is a sole proprietorship, the oath or affirmation must be made by the proprietor; if a partnership, by a general partner; if a corporation, by a duly authorized officer.

Confidentiality

Rule 17a-5(e)(3) provides that the audited financial statements “shall be public, except that, if the Statement of Financial Condition . . . is bound separately from the balance of the annual audited financial statements . . . the balance of the annual audited financial statements shall be deemed confidential, except that they shall be available for official use . . .”

In order to receive confidential treatment for the financial statements other than the Statement of Financial Condition in accordance with Rule 17a-5(e)(3), the broker-dealer should do the following:

Bind the Statement of Financial Condition separately from the balance of the annual audited financial statements or place it in a separate package. Complete and attach an “Annual Audited Report, Form X-17A-5, Part III, Facing Page” to the Statement of Financial Condition. Mark the Facing Page “Public.”

Bind the balance of the annual audited financial statements separately or place them in a separate package. Complete and attach an “Annual Audited Report, Form X-17A-5, Part III, Facing Page” to these statements. Mark the Facing Page “Confidential Treatment Requested.”

The public and non-public portions of the financial statements must be clearly segregated and the Facing Page must be appropriately marked. For example, the Facing Page attached to the Statement of Financial Condition should not be marked “Confidential.” Further, if the Statement of Financial Condition is not bound separately or placed in a separate package, then, in accordance with Rule 17a-5(e)(3), none of the statements will be accorded confidential treatment.

Rule 17a-5(e)(3) does not require the submission of a letter requesting confidential treatment. It is not necessary to mark the mailing envelope “Confidential.”

Audit Waivers and Extensions

• For the initial audit report, broker-dealers should refer to the letter of December 16, 2005 from Thomas K. McGowan to the New York Stock Exchange, Inc. and NASD Regulation, Inc. at http://www.sec.gov/divisions/marketreg/mr-noaction/nysenasd121605.pdf
   
• In accordance with Rule 17a-5(m), a broker-dealer's designated examining authority may extend the period for filing annual audit reports.
   
• Other questions and requests regarding audit waivers should be addressed to Thomas K. McGowan, Assistant Director, Division of Trading and Markets, and sent by fax to 202-772-9273.

General Inquiries

• For general inquiries to the Division of Trading and Markets, you may call 202-551-5777 (Office of Interpretation and Guidance).
   
• Inquiries may also be made by email to tradingandmarkets@sec.gov. Please include a telephone number that the Division staff can use to contact you. Any notices directed to the Office of Broker-Dealer Finances must be faxed to 202-772-9273.

http://www.sec.gov/divisions/marketreg/bdnotices.htm