An adviser reports $150 million AUM, but only $40 million is in actively managed accounts and $110 million is in consulting-only relationships. Under the USA and SEC rules, which statement is most accurate?

1. AAll $150 million counts towards federal AUM for registration purposes
2. BOnly the $40 million in managed accounts counts; consulting-only assets are excluded✓ Correct answer
3. COnly accounts for which the adviser has discretionary authority count toward AUM
4. DNone of these assets count unless the adviser has custody

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