The SEC has adopted final rules requiring investment advisers to provide additional information on Form ADV and other matters. You can find our analysis on the proposed rules here.

The final rules:

• require information about an investment adviser’s separately managed account business and other matters;
• incorporate a method for private fund adviser entities operating a single advisory business to register using a single Form ADV;
• make clarifying, technical and other amendments to certain Form ADV items and instructions;
• make technical amendments to the Investment Advisers Act books and records rule; and
• remove transition provisions that are no longer necessary.

In particular, the final rules amend Advisers Act Rule 204-2 to require advisers to maintain additional records related to the calculation and distribution of performance information. The SEC believes these records will be useful to the Commission’s examinations staff in evaluating adviser performance claims, and could reduce the incidence of misleading or fraudulent advertising and communications by advisers.

The amendments to Part 1A of Form ADV are intended to provide a more efficient method for the registration on one Form ADV of multiple private fund adviser entities operating a single advisory business, which the SEC refers to as umbrella registration. While the SEC staff has provided guidance to private fund advisers regarding umbrella registration, the SEC believes the amendments to incorporate umbrella registration into Form ADV will make the availability of umbrella registration more widely known to advisers. The SEC also believes uniform filing requirements for umbrella registration in Form ADV will provide more consistent data about, and create a clearer picture of, groups of private fund advisers that operate as a single business.