December 15, 1993
TO: INVESTMENT ADVISERS COMMITTEE NO. 39-93
ARKANSAS ASSOCIATE INVESTMENT ADVISER MEMBERS
RE: INSTITUTE COMMENTS ON PROPOSED ARKANSAS RULES
__________________________________________________________
As we previously informed you, the Arkansas Securities Commissioner has
issued for comment proposed amendments to the rules under the Arkansas Securities
Act (the "Act") governing the activities of investment advisers. (See Memorandum
to Investment Advisers Committee No. 36-93, dated December 7, 1993.) Attached
is a copy of the Institute's comment letter on these proposed rules.
In its letter, the Institute recommends that the proposed rule which
governs the registration of investment advisers be amended to delete a
requirement that an applicant file: (1) articles of incorporation and by-laws or
their partnership agreement, and (2) a separate statement signed by an officer
or partner relating to the applicant's disciplinary history the preceding year.
In support of its recommendation, the Institute's letter explains that the
substantive information required by these filings is already provided on Form
ADV.
The Institute's letter further recommends that provisions in the proposed
rules relating to financial statements be amended to: (1) only require audited
financial statements of those applicants and registrants that have custody of
customer funds or securities or that require prepayment of advisers fees of more
than $500 per client and six or more months in advance; and (2) define "financial
statements" to mean a balance sheet.
Tamara K. Cain
Assistant Counsel
Attachment