The Financial Industry Regulatory Authority has issued an information notice to members focusing on recent rules amendments by the Securities and Exchange Commission regarding annual reports.
FINRA’s notice, released last month, cites the SEC’s rules governing electronic submission of filings and other materials to the SEC. The rules amendments require, among other things, that members submit their annual reports pursuant to SEA Rule 17a-5 to the SEC electronically in lieu of paper form, and they also make changes to the Financial and Operational Combined Uniform Single Report (FOCUS Report). FINRA notes that the changes do not affect how members their submit their annual reports to the authority because FINRA already requires electronic submission of these reports.
FINRA has updated its eFOCUS page with further information on the FOCUS Report amendments.
In its information notice, FINRA points out some of the key changes contained in the SEC amendments that may affect members.
Under the new rule, electronic signatures are subject to a specified signing process. The SEC noted that one example of an acceptable electronic signature is Adobe Acrobat’s digitally signed certificate, when the document is locked after signing.
Other amendments are as follows:
-The instructions to FOCUS Report Part II and FOCUS Report Part IIA have been modified to require the signature of one principal officer, specifically, either the principal executive officer or principal financial officer (or their comparable officers).
-The requirement to notarize the “Oath or Affirmation” associated with the annual report has been eliminated. Under the SEC’s amended rule, there is an added requirement that the signed Oath or Affirmation must be kept for a period of not less than six years, the first two in an easily accessible place and in accordance with SEA Rule 17a-4.9
FINRA also advised its members to note that the SEC no longer accepts paper submissions of the annual report. Beginning June 30, 2025, the SEC has required all broker-dealers to file the annual report on Electronic Data Gathering, Analysis, and Retrieval system (“EDGAR”) in Portable Document Format (PDF). The same applies to all supplemental reports and statements filed with the SEC pursuant to SEA Rule 17a-5(k) and all submissions of Form 17-H pursuant to Rule 17h-2T.
Every member must obtain EDGAR access credentials in order to submit their filings to the SEC. Members that have not previously filed on EDGAR need to submit Form ID in accordance with instructions on the SEC website: Apply for EDGAR Access—Applicants with an EDGAR Central Index Key (CIK) Account but No Access Codes. Due to the high volume of submissions, there may be a delay of five to seven business days in obtaining approval of the Form ID submission.
Financial professionals who work for broker-dealers, RIAs or other financial service companies operate in a highly regulated industry that is overseen by the SEC, state regulators and other self-regulatory organizations such as FINRA and various exchanges. If you are the subject of a regulatory proceeding, contact the FINRA compliance lawyers Hyman Cotter PC at 312-291-4600 or through our online contact form for a free consultation.
