The US Securities and Exchange Commission (SEC) has voted to ease some of the tenets of the Form PF reporting requirements, a mandate in Dodd-Frank that gives the Financial Stability Oversight Council insight into the activities of advisers to hedge funds and other private funds.
Significantly, the regulator raised the threshold for large private advisers subject to heightened reporting requirements to those with assets under management of $1.5 billion or more. Previously the threshold was $1 billion. Large private advisers must file information regarding leverage, credit providers, investor concentration and fund performance on an annual basis, plus quarterly reports including funds risk profiles, according to J.H. Cohn LLP, an accounting and consulting firm.
The SEC also lengthened the time frame large private advisers have to file from 15 days to 60 days from the end of the quarter or fiscal year.
Advisers with less than $150 million in regulatory assets under management do not need to file. Those with more than $150 million but less than the $1.5 billion threshold will be given 120 days to file rather than the initially proposed 90 days. These smaller advisers must annually report information about fund strategy, counterparty credit risk and use of trading and clearing mechanisms, according to J.H. Cohn.
The SEC also extended the first required filing date for most advisers to the first fiscal year or quarter, depending on the advisers AuM, ending on or after Dec. 15, 2012. The biggest advisers, those with $5 billion or more of assets under management attributable to hedge funds, must file with the earlier quarter- or fiscal year-end on or after June 15, 2012.
The final set of requirements for Form PF await a vote by the Commodity Futures Trading Commission (CFTC), the US futures and options regulator, next week.
The data collection form that we have adopted will address the dramatic lack of private fund information available to regulators today while easing the burden on private fund managers producing the data, says SEC Chairman Mary L. Schapiro.
Form PF places an increased regulatory burden on private funds, particularly hedge funds, that historically have operated with relatively little regulatory oversight. Fund administrators have responded by developing Form PF reporting services, such as the ones developed by GlobeOp and Viteos.
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