Normally, when one is in operations and they receive a pending SEC audit, they would start to panic and worry. Now, all regulated industries undergo periodic examinations, hence it is a good idea to have a system in place which allows the organization to be ready for such examinations. This post will help better prepare you for SEC Audit. The following steps would be useful when a company is first notified of the pending audit, including the use of document vault software for advisors and RIAs.
- Let the Staff Know
The first thing which needs to be done is that all staff should be notified about the audit as they play a role in preparing for the audit and a few would even be involved in the audit. The staff needs to be made aware. Some of the employees will gather information, while others will be interviewed or assist with continuing on with the daily activities.
- Communicate to Suppliers/ Key Service Providers
Suppliers and key service providers should be notified. This includes independent managers, investment research platforms, and custodians. They should be informed about the regulatory audit being conducted and the need for them to respond promptly to support information requests.
- Report to the Audit/ Compliance Department
If the company has outsourced the internal audit/ compliance department, then they should be made aware of the audit. Provide initial request letters to them from the regulatory organization.
- Collect Necessary Information
After receiving the initial request letter, pull together the requested data. Maintain control over the examination by providing only the data requested.
- Use the Document Management system for Advisors and RIAs
Use the Document Management system for advisors and RIAs to store all important information such as ReportWa’s Document Vault so that all documents are available at the time of need. This will help save time and show competency to the regulatory.
- Conduct Internal Reviews
Whenever the audit is requested, a date would be provided for meeting the data request. It is advised to perform internal reviews. Limited-scope exams should be performed. Make it a practice to have an internal review before submission.
- Host Staff Preparation Meeting
Staff should be made aware of the fact that audit is common in a regulated industry. Before the examination, conduct a staff meeting in order to help prepare the staff for the audit, set expectations and review the role of the team.
- Retain Control & Be Courteous
Be hospitable to the examiners as they are simply doing their job. Keep your cool and remain in control.
By following the above-recommended tips, you will be better prepared to deal with SEC audit and have a solid set of compliance practice in place.
