Series 63 practice questioneasybalance sheet delivery
A state-registered investment adviser accepts prepayment of fees greater than $500, six months or more in advance. What is the adviser's obligation under the USA?
- ADeliver an annual audited balance sheet to each client✓ Correct answer
- BSubmit a daily financial report to the Administrator
- CProvide a balance sheet only if there is a client complaint
- DNo specific requirement regarding balance sheets
Explanation
Why A — Deliver an annual audited balance sheet to each client
Advisers who accept prepaid fees greater than $500 six months or more in advance must deliver an audited balance sheet to clients under the USA. This is a state requirement and may be codified in the state's version of the USA or rules adopted thereunder.
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