Rule 206(4)-2 under the Investment Advisers Act of 1940--Custody of Funds or Securities of Clients by Investment Advisers

Forms and Documents

Forms and supporting documents for this ICR

Document	Type	Status	Availability
Rule_206(4)-2_Supporting_Statement 2018.pdf	Supporting Statement A	Uploaded 2019-07-31	Available
Rule 206(4)-2 60 Day Notice 2018 (12.21.18).doc	Supplementary Document	Uploaded 2019-01-31	Available
Rule 206(4)-2 30 Day Notice 2018 (12.21.18).doc	Supplementary Document	Uploaded 2019-01-31	Available

IC Document Collections

Information collection document groups

IC ID	Collection	Type	Status	Form
34671	Rule 206(4)-2 under the Investment Advisers Act of 1940--Custody of Funds or Securities of Clients by Investment Advisers		Modified

ICR Details

OMB Control No: 3235-0241	ICR Reference No: 201812-3235-010
Status: Active	Previous ICR Reference No: 201510-3235-020
Agency/Subagency: SEC	Agency Tracking No: IM-270-217
Title: Rule 206(4)-2 under the Investment Advisers Act of 1940--Custody of Funds or Securities of Clients by Investment Advisers
Type of Information Collection: Extension without change of a currently approved collection	Common Form ICR:  No
Type of Review Request: Regular
OIRA Conclusion Action: Approved with change	Conclusion Date: 08/07/2019
	Date Received in OIRA: 04/16/2019
Terms of Clearance:

table that charts list comparision

	Inventory as of this Action	Requested	Previously Approved
Expiration Date	08/31/2022	36 Months From Approved	08/31/2019
Responses	21,614,351	0	35,707,240
Time Burden (Hours)	246,532	0	816,285
Cost Burden (Dollars)	163,610,000	0	147,440,000

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Abstract: Rule 206(4)-2 under the Investment Advisers Act of 1940 requires advisers to protect the assets that their advisory clients have entrusted to their custody.

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Authorizing Statute(s): US Code: 15 USC 80b-6(4) Name of Law: Investment Advisers Act of 1940
   US Code: 15 USC 80b-11(a) Name of Law: Investment Advisers Act of 1940
  

Citations for New Statutory Requirements: None

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Associated Rulemaking Information
RIN:	Stage of Rulemaking:	Federal Register Citation:	Date:
	Not associated with rulemaking

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Federal Register Notices & Comments
60-day Notice:	Federal Register Citation:	Citation Date:
	84 FR 2611	02/07/2019
30-day Notice:	Federal Register Citation:	Citation Date:
	84 FR 14158	04/09/2019
Did the Agency receive public comments on this ICR? No

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Number of Information Collection (IC) in this ICR: 1

table that charts list of burden

IC Title	Form No.	Form Name
Rule 206(4)-2 under the Investment Advisers Act of 1940--Custody of Funds or Securities of Clients by Investment Advisers

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ICR Summary of Burden

table that charts list of burden

	Total Approved	Previously Approved	Change Due to New Statute	Change Due to Agency Discretion	Change Due to Adjustment in Estimate	Change Due to Potential Violation of the PRA
Annual Number of Responses	21,614,351	35,707,240	0	0	-14,092,889	0
Annual Time Burden (Hours)	246,532	816,285	0	0	-569,753	0
Annual Cost Burden (Dollars)	163,610,000	147,440,000	0	0	16,170,000	0

Burden increases because of Program Change due to Agency Discretion: No

Burden Increase Due to:

Burden decreases because of Program Change due to Agency Discretion: No

Burden Reduction Due to:

Short Statement: The current annual burden approved by OMB for rule 206(4)-2 is 816,285 hours. We now estimate that the total information collection hours is 246,532 hours. The primary cause of such decrease is the result of removing an outlier from the Form ADV data set that significantly skewed the average number of investors per pooled investment vehicle in the prior estimate. The currently approved annual burden under rule 206(4)-2 includes an aggregate cost estimate of $147,440,000. We now estimate that the annual cost burden under the rule would decrease to $163,610,000, which is primarily caused by an increase in the number of small sized advisers that will be subject to the surprise examination requirement with respect to 5% of their clients as well as inflation adjustments.

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Annual Cost to Federal Government: $0

Does this IC contain surveys, censuses, or employ statistical methods? No

Does this ICR request any personally identifiable information (see OMB Circular No. A-130 for an explanation of this term)? Please consult with your agency's privacy program when making this determination.     No

Does this ICR include a form that requires a Privacy Act Statement (see 5 U.S.C. §552a(e)(3))? Please consult with your agency's privacy program when making this determination.     No

Is this ICR related to the Affordable Care Act [Pub. L. 111-148 & 111-152]? No

Is this ICR related to the Dodd-Frank Wall Street Reform and Consumer Protection Act, [Pub. L. 111-203]? No

Is this ICR related to the American Recovery and Reinvestment Act of 2009 (ARRA)? No

Is this ICR related to the Pandemic Response? Uncollected

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Common Form ICR:  No

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On behalf of this Federal agency, I certify that the collection of information encompassed by this request complies with 5 CFR 1320.9 and the related provisions of 5 CFR 1320.8(b)(3).

The following is a summary of the topics, regarding the proposed collection of information, that the certification covers:

(a) It is necessary for the proper performance of agency functions;

(b) It avoids unnecessary duplication;

(c) It reduces burden on small entities;

(d) It uses plain, coherent, and unambiguous language that is understandable to respondents;

(e) Its implementation will be consistent and compatible with current reporting and recordkeeping practices;

(f) It indicates the retention periods for recordkeeping requirements;

(g) It informs respondents of the information called for under 5 CFR 1320.8 (b)(3) about:

(i) Why the information is being collected;

(ii) Use of information;

(iii) Burden estimate;

(iv) Nature of response (voluntary, required for a benefit, or mandatory);

(v) Nature and extent of confidentiality; and

(vi) Need to display currently valid OMB control number;

(h) It was developed by an office that has planned and allocated resources for the efficient and effective management and use of the information to be collected.

(i) It uses effective and efficient statistical survey methodology (if applicable); and

(j) It makes appropriate use of information technology.

If you are unable to certify compliance with any of these provisions, identify the item by leaving the box unchecked and explain the reason in the Supporting Statement.

Certification Date: 04/16/2019

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