Supporting Statement A

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PAPERWORK REDUCTION ACT SUPPORTING STATEMENT
for the Revision of the Information Collection Submission for
Form ADV
OMB Control Number 3235-0049

The U.S. Securities and Exchange Commission (“Commission,” “SEC,” or “we”) submits this
information collection request (“ICR”) pursuant to the Paperwork Reduction Act of 1995 (“PRA”), 44
U.S.C. Section 3501 et seq., with the following justification.

1.

Necessity of Information Collection
Form ADV is a three-part investment adviser form. Part 1 of Form ADV contains information

used primarily by Commission staff, Part 2 is the client brochure, and Part 3 requires registered
investment advisers that offer services to retail investors to prepare and file with the Commission, post
to the adviser’s website (if it has one), and deliver to retail investors a relationship summary.
The Commission uses the information in Form ADV to determine eligibility for registration with
us and to manage our regulatory, examination, and enforcement programs. Clients and prospective
clients use the information required in Form ADV to determine whether to hire or retain an investment
adviser, and, if hired, how to manage that relationship. Rule 203-1 1 under the Investment Advisers Act
of 1940 (“Advisers Act”) 2 requires every person applying for investment adviser registration with the
Commission to file Form ADV. 3 Rule 204-4 4 under the Advisers Act requires certain investment

1

17 CFR 275.203-1.

2

15 U.S.C 80b-4.

3

17 CFR 279.1.

4

17 CFR 275.204-4.

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advisers exempt from registration with the Commission (“exempt reporting advisers”) to file reports
with the Commission by completing a limited number of items on Form ADV. Rule 204-1 5 under the
Advisers Act requires any adviser that is required to complete Form ADV to update the form at least
annually, including exempt reporting advisers that report to the Commission pursuant to rule 204-4, and
requires advisers to submit electronic filings through the Investment Adviser Registration Depository
(“IARD”). The paperwork burdens associated with rules 203-1, 204-1, and 204-4, as well as the
obligation to deliver codes of ethics to clients under rule 204A-1, are included in the approved annual
burden associated with Form ADV and thus do not entail a separate collection of information.
Form ADV contains “collection of information” requirements within the meaning of the
Paperwork Reduction Act of 1995. 6 The collection of this information is designed to provide
information to the Commission in connection with the registration and annual amendments to Form
ADV filed by investment advisers and will assist Commission staff in connection with its review of
existing registrations and registration applications for compliance and, as applicable, for possible
deregistration for an inability to meet the conditions of the rules. Responses are not kept confidential.
The title of this collection of information is: “Form ADV under the Investment Advisers Act of
1940” and the Commission previously submitted this collection to the Office of Management and
Budget (“OMB”) for review in accordance with 44 U.S.C. 3507(d) and 5 CFR 1320.11. OMB
approved, and subsequently extended, this collection under control number 3235-0049 (expiring on
September 30, 2029). An agency may not conduct or sponsor, and a person is not required to respond
to, a collection of information unless it displays a currently valid OMB control number. The paperwork
burdens associated with rules 203-1, 204-1, 204A-1, and 204-4 are included in the approved annual
burden associated with Form ADV and thus do not entail separate collections of information. These

5

17 CFR 275.204-1.

6

44 U.S.C. 3501 to 3520.

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collections of information are found at 17 CFR 275.203-1, 275.204- 1, 275.204-4, 275.204A-1, and
279.1 (Form ADV itself) and are mandatory. The respondents are investment advisers registered with
the Commission or applying for registration with the Commission or exempt reporting advisers. A
On October 1, 2027, the Commission proposed, among other things, to amend Form ADV
related to proposed amendments to the Advisers Act rule 206(4)-2 (the “custody rule”). 7 As discussed
more fully in the Proposing Release, the proposed amendments would, in relevant part, amend rule Form
ADV to:
•

Require new questions in Part 1A and Schedule D related to the proposed crypto asset selfcustody rule;

•

Add new questions to Item 9 that address an adviser’s reliance on certain exceptions under the
Advisers Act custody rule as well as an adviser’s use of State trust companies as qualified
custodians, and other amendments to Item 9 to promote more consistent reporting of an adviser’s
and a related person’s custody;

•

Add new questions to Schedule D of Form ADV regarding tokenized private funds; and Make
certain conforming amendments to reflect the proposed amendments to the Advisers Act custody
rule.

2.

Purpose and Use of Information Collection
The purpose of Form ADV is to provide advisory clients, prospective clients, and the

Commission with information about an adviser and its business, conflicts of interest, and personnel. We
use the information to determine eligibility for registration with us and to manage our regulatory,
examination, and enforcement programs. The information filed with the Commission permits the
verification of compliance with securities law requirements and assures the public availability and

7

See Adviser and Regulated Fund Custody Rules; Crypto Custody Rules, Release Nos. IA-7023; IC-36353;
(“Proposing Release”). The Commission also proposed to renumber portions of the custody rule that are not being
amended (“Proposing Release”).

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dissemination of the information. Unlike many other federal information collections, which are
primarily for the use and benefit of the collecting agency, this information collection is also for the use
and benefit of clients and prospective clients. Clients and prospective clients use certain of the
information to determine whether to hire an adviser and, if hired, how to manage that relationship.
This collection of information is found at 17 CFR 275.203-1, 275.204-1, 275.204- 4, 275.204A1, and 275.279.1, and it is mandatory. Responses are not kept confidential. The majority of the
respondents to the Form ADV collection of information are investment advisers registered with the
Commission or applying for registration with the Commission while the additional respondents to the
Form ADV collection of information are exempt reporting advisers. The information collected takes the
form of disclosures to respondents’ clients, potential clients, and the Commission.

3.

Use and Consideration of Information Technology
The information collected pursuant to Form ADV takes the form of disclosures made by

investment advisers to their clients and potential clients and reporting to the Commission. Investment
advisers currently file their Form ADV electronically on the IARD system. This method of collecting
information reduces the regulatory burden upon investment advisers by permitting them to file
applications for registration, and amendments thereto, at one central location, rather than filing Form
ADV separately with the Commission and the states for notice filing purposes.
Exempt reporting advisers are subject to reporting, but not registration, requirements and must
submit their reports through the IARD using the same process as registered investment advisers.
Because exempt reporting advisers may be required to register on Form ADV with one or more state
securities authorities, use of the existing form and filing system permits these advisers to satisfy both
state and Commission requirements with a single electronic filing. Our approach permits an adviser to
transition from filing reports with us to applying for registration under the Advisers Act by simply
amending its Form ADV; the adviser would check the box to indicate it is filing an initial application for

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registration, complete the items it did not have to answer as an exempt reporting adviser, and update the
pre-populated items that it already has on file.

4.

Identifying and Minimizing Duplication
The collection of information requirements of the form, including the amendments to the form, are

not duplicated elsewhere. While Form ADV Part 3 requires firms to summarize topics also required to
be discussed in Form ADV Part 1 or Part 2, Form ADV Part 3 has a distinct purpose to help retail
investors select or determine whether to remain with a firm or financial professional by providing better
transparency and summarizing in one place selected information about a particular investment adviser.
The Commission periodically evaluates rule-based reporting and recordkeeping requirements for
duplication and reevaluates these requirements whenever it adopts amendments to its rules.

5.

Effect on Small Entities
The requirements of Form ADV, including the amendments, are the same for all investment

advisers registered with the Commission, including those advisers that are small entities. The
requirements of Form ADV applicable to exempt reporting advisers also are the same for all exempt
reporting advisers, including those that are small entities. Subject to certain exceptions, investment
advisers with less than $100 million in assets under management generally are not permitted to register
with the Commission and must register with state securities authorities. Because the protections of the
Advisers Act are intended to apply equally to retail investor clients of both large and small firms, it
would be inconsistent with the purposes of the Advisers Act to specify differences for small entities
under the amendments to Form ADV. The Commission reviews all rules periodically, as required by the
Regulatory Flexibility Act, to identify methods to minimize recordkeeping or reporting requirements
affecting small businesses.

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6.

Consequences of Not Conducting Collection and Obstacles to Reducing
Burden
The collection of information required by the form is necessary to protect investors by providing

clients and potential clients, as well as the Commission, with information about the adviser and its
business, conflicts of interest, and personnel. The consequences of not collecting this information would
be that clients and prospective clients may not have the information they need in order to evaluate the
adviser’s business practices and to determine whether to hire an adviser and, if hired, how to manage
that relationship. In addition, if the information is either not collected or is collected less frequently, the
Commission’s ability to protect investors would be reduced.

7.

Inconsistencies with Guidelines in 5 CFR 1320.5(d)(2)
This collection is not inconsistent with 5 CFR 1320.5(d)(2).

8.

Public Comment and Consultations Outside the Agency
The Commission requested comment on its proposal to amend Form ADV. The Commission’s

solicitation of public comments included estimating and requesting public comments on the burden
estimates for all information collections under this OMB control number (i.e., both changes associated
with the rulemaking and other burden updates). The Commission and the staff of the Division of
Investment Management participate in an ongoing dialogue with representatives of the investment
adviser industry through public conferences, meetings, and informal exchanges. These various forums
provide the Commission and staff with a means of ascertaining and acting upon paperwork burdens
confronting the industry. The Commission requested public comment on the collection of information
requirements in Form ADV before it submitted this request for extension and approval to the OMB. The
Commission received no comments in response to its request.

9.

Payment or Gift to Respondents
Not applicable.

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10.

Assurance of Confidentiality and Privacy
The assurance of information collected pursuant to Form ADV is through filings with the

Commission. These disclosures are not kept confidential.

11.

Collection Questions of a Sensitive Nature
Not applicable.

12.

Estimated Time Burden and its Cost Equivalent
We are revising our total burden estimates to reflect the proposed amendments, updated data, and

new methodology for certain estimates.6 The following estimates of average burden hours and costs are
made solely for purposes of the Paperwork Reduction Act of 1995 8 and are not derived from a
comprehensive or even representative survey or study of the cost of Commission rules and forms.
The respondents to current Form ADV are investment advisers registered with the Commission
or applying for registration with the Commission and exempt reporting advisers. 9 Our latest data
indicate that there were approximately 16,442 advisers registered with the Commission (“RIAs”) and
6,389 exempt reporting advisers (“ERAs”) as of December 31, 2025 (incorporating Form ADV filings
received through March 31, 2026). The burdens associated with completing Parts 2 and 3 also are
included in the PRA for purposes of updating the overall Form ADV information collection. Based on
the prior revision of Form ADV, we estimated the aggregate annual internal compliance burden to
comply with the collection of information requirement of Form ADV under the proposed amendments is
approximately 259,438 hours per year for a monetized burden of $143,469,214 10

8

44 U.S.C. 3501 et seq.

9

An exempt reporting adviser is an investment adviser that relies on the exemption from investment adviser
registration provided in either section 203(l) of the Advisers Act because it is an adviser solely to one or more
venture capital funds or section 203(m) of the Advisers Act because it is an adviser solely to private funds and has
assets under management in the United States of less than $150 million.

10

See infra Form ADV Paperwork Reduction Act Estimates Table.

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In addition, the Commission recently updated the data sources and methodology that it generally
uses for calculating occupational hourly rates that are used in estimating certain PRA burdens. 11
The chart below summarizes the burden estimates associated with compliance with the proposed
changes to the Form ADV filing requirement. The chart illustrates the total estimated burden per adviser
to complete Form ADV would increase from 10.85 hours to 11.17 hours. Further, the estimated internal
cost per adviser would increase from $5,945.80 to $6,177.

11

See infra note 3 of Form ADV Paperwork Reduction Act Estimates Table.

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FORM ADV PAPERWORK REDUCTION ACT ESTIMATES
RIAS (BURDEN FOR PARTS 1 AND 2, NOT INCLUDING PRIVATE FUND REPORTING)1

Internal Initial
Burden Hours

Internal
Amendment
Burden
Hours 2

Wage Rate3

Internal Time
Costs

P roposed c hang es to P art 1 A and
S c hedule D ( per adv is er)

1 hour

0.4 hours

$553 (blended revised
rate for financial
examiner and financial
manager)5

1.4 hours x $553
per hour = $775

Current burden per adviser

29.72 hours 6

11.80 hours 7

$548

(29.72 hours +
11.80 hours) x
$548 =
$22,752.96

$4,7848

Revised burden per adviser

29.72 hours + 1
hour =30.72
hours

11.8 hours +
0.4 hours =
12.2 hours

$553 (blended revised
rate for financial
examiner and financial
manager)5

(30.72 + 12.2) x
$553 =
$23,734.76

$5,4139

Total updated aggregate
burden estimate

11,827 hours 10

205,289
hours 11

$553 (blended revised
rate for financial
examiner and financial
manager)

(11,827 +
205,289) x $553
= 120,065,148

$2,084,00512

--

$553

--

$548

(6.67 hours +
1.66 hours) x
$548 =
$4,564.84

$2,758.74. per
adviser16

4

Annual External
Cost Burden

RI As ( burden f or P art 3 ) 1 3
N o propos ed c hang es

--

--

Current burden per RIA

6.67 hours

Revised burden per RIA

No change

No change

No change

No change

No change

Total updated aggregate
burden estimate

4,833.33 hours 17

18,633.50
hours 18

$553 (blended revised
rate for financial
examiner and financial
manager)

(74,870.75 hours
+ 18,633.50
hours) x $553 =
$51,707,850

$2,024,562.50 19

14

1.66 hours

15

ERAs ( burden for P art 1 A, not inc luding private fund reporting) 2 0

N o propos ed c hang es

Current burden per ERA

Revised burden per ERA

Total updated aggregate burden
estimate

No change

No change

$553 (blended revised
rate for financial
examiner and financial
manager)

(3.60 hours +
1.51 hours) x
$553 = $
2,825.53

--

3.60 hours 21`

1.5 hours +
(0.1 hours x
675 final
filings)/
7,178 current
and expected
ERAs) = 1.51
hours 22

$548

(3.60 hours +
1.51 hours) x
$548 = $
2,800.28

$0

No change

No change

$553 (blended revised
rate for financial
examiner and financial
manager)

(3.60 hours +
1.51 hours) x
$553 = $
2,825.53

No change

2,840.40 hours

10,834.50
hours 24

$553 (blended revised
rate for financial
examiner and financial
manager)

($553 x
(2,840.40 +
10,834.50
hours)) =
$7,562,220

$0

23

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P rivate Fund Reporting 2 5

P ropos ed c hang es ( per adv is er)

$553 (blended revised
rate for financial
examiner and financial
manager)

.10 hours

N/A

1 hour per private
fund26

N/A–included
in the existing
annual
amendment
reporting
burden for
ERAs

Revised burden per adviser to private
fund

Total updated aggregate burden
estimate

Current burden per adviser to private
fund

N/A

N/A

$548

N/A

Cost of
$55,042.33 per
fund applied to 6%
of RIAs that report
private funds 27

1 hour + .1 hour
= 1.10 hours

N/A–included
in the existing
annual
amendment
reporting
burden for
ERAs

$553 (blended revised
rate for financial
examiner and financial
manager)

N/A

No change

5,180 hours 28

N/A

$553 (blended revised
rate for financial
examiner and financial
manager)

($553 x $5,180
hours) =
$2,864,54029

$19,705,154.1430

10.85 hours 31

10.85 hours x
$548 =
$5,945.80 per
adviser cost of
the burden hour

$1,026.4232

11.17 hours 33

11.17 hours x
$553 = $6,177
per adviser cost
of the burden
hour

$1,025.7534

$23,547,079.1436

$23,813,721.6438

TOTAL ESTIMATED BURDENS, INCLUDING AMENDMENTS

Current per adviser burden/external
cost per adviser

Revised per adviser burden/external
cost per adviser

Current aggregate burden estimates

251,851.53 initial and amendment hours annually 35

251,851.53 x
$548 =
$138,014,638.4
4 aggregate cost
of the burden
hour

Revised aggregate burden estimates

259,438 initial and amendment hours annually37

259,438 x $553
= 143,469,214
aggregate cost of
the burden hour

N otes :
1. Based on Form ADV data as of December 31, 2025, we estimate that there are 16,442 RIAs (“current RIAs”) and 385 net new advisers that are expected
to become RIAs annually (“expected new RIAs”). We obtain the expected new RIAs number by taking the average number of new RIAs over the past three
years (1,203) and subtracting the average RIA deregistrations over the past three years (818), for a total of 385 net new advisers on average.
2. This column estimates the hourly burden attributable to annual and other-than-annual updating amendments to Form ADV, plus RIAs’ ongoing obligations
to deliver codes of ethics to clients.
3. To calculate the occupational hourly rates used in this release, the Commission uses the May 2025 occupational mean hourly wage data from the
Occupational Employment and Wage Statistics (OEWS) program of the Bureau of Labor Statistics (BLS) for “Securities, Commodity Contracts, and Other
Financial Investments and Related Activities” (NAICS 523). See Occupational Employment and Wage Statistics, U.S. BUREAU OF LABOR STATISTICS,
https://www.bls.gov/oes/; see also Standard Occupational Classification, U.S. BUREAU OF LABOR STATISTICS, https://www.bls.gov/soc/ (describing
occupational classification system used by BLS); EXEC. OFF. OF THE PRESIDENT, OFF. OF MGMT. & BUDGET, NORTH AMERICAN INDUSTRY CLASSIFICATION
SYSTEM (2022), available at https://www.census.gov/naics/reference_files_tools/2022_NAICS_Manual.pdf (describing the industry classification system
used by BLS and other agencies). The mean hourly wage for each occupation is multiplied by an employment cost index (ECI) factor of 1.0227, calculated as
one plus the percentage change in the seasonally adjusted ECI for wages and salaries of private industry workers from the second quarter of 2025
(ECI=173.563), which contains the May 2025 OEWS reference period, to the first quarter of 2026 (ECI=177.498), which is the date of the most recently
available ECI observations when the occupational hourly rates used in this release were calculated. See Employment Cost Index, U.S. BUREAU OF LABOR
STATISTICS, Seasonal Data 2001-Present, available at https://www.bls.gov/eci/tables.htm. The adjusted mean hourly wage is then multiplied by a nonwage
cost adjustment factor of 5.734, which accounts for nonwage costs borne by employers, such as bonuses, benefits, and overhead. This factor is calculated as
the average, over 2016-2025, of the ratio of the Bureau of Economic Analysis's gross output for NAICS 523 to total annual wages across all occupations for
NAICS 523 in the OEWS data. See Gross Output by Industry, U.S. BUREAU OF ECONOMIC ANALYSIS, https://www.bea.gov/data/industries/gross-output-byindustry; Occupational Employment and Wage Statistics, U.S. BUREAU OF LABOR STATISTICS, https://www.bls.gov/oes/. For example, the $730 occupational

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hourly rate for financial manager is calculated as $124.46 × 1.0227 × 5.734, or approximately $730 (where 124.47 is the May 2025 mean hourly wage for
financial manager in NAICS 523). The final product is the occupational hourly rate. See generally UPDATED METHODOLOGY FOR CALCULATING
OCCUPATIONAL HOURLY RATES (Dec. 19, 2025), available at https://www.sec.gov/files/method-occupational-hourly-rates.pdf.
4. We estimate that 13,462 RIAs (80% of the total (16,827) of combined current (16,442) and expected (385) RIAs that are required to complete Parts 1 and
2) would incur a burden of 0.5 hour, and 3,365 RIAs (20% of 16,827 current and expected RIAs that are required to complete Parts 1 and 2 would incur a
burden of 0 hours. (13,462 RIAs x 0.5) + (3,365 RIAs x 0) / 16,827 = 0.4 blended average hours per RIA.
5. The $553 wage rate reflects current wage estimates from the new occupational hourly rate methodology based on data from the Bureau of Labor and
Statistics (“BLS Wage Data”). This wage represents a blended revised rate utilizing the $375 per hour rate for a financial examiner and the $730 per hour
rate for a financial manager. ($375 + $730) / 2 = $553.
6. See 2026 Form ADV PRA Renewal.
7. The currently approved average total annual burden for RIAs attributable to annual and other-than-annual updating amendments to Form ADV, Parts 1 and
2 is 11.80065 hours per RIA. See 2026 Form ADV PRA Renewal.
8. See 2026 Form ADV PRA Renewal
9. We continue to estimate that a quarter of RIAs would seek the help of outside legal services and half would seek the help of compliance consulting services
in connection with the amendments to Form ADV, Part 1A. This is based on previous estimates and ratios we have used for advisers we expect to use external
services for initially preparing various parts of Form ADV. See 2020 Form ADV PRA Renewal (the subsequent amendment to Form ADV described in the 2021
Form ADV PRA did not change that estimate). With the new wage methodology, instead of using the term “outside counsel,” we are using the term “lawyer”
and instead of using the term “outside management consultant,” we are using the term “financial manager.” We estimate $774 per hour for a lawyer, and
$730 per hour for a financial manager. External cost per RIA includes the external cost for initially preparing Part 2, which we have previously estimated to be
approximately 10 hours for a lawyer for a quarter of RIAs, and 8 hours of financial manager services for half of RIAs. We estimate that a quarter of advisers
that prepare Part 1 will utilize a lawyer’s services and half of advisers that prepare Part 1 will utilize financial management services. See 2020 Form ADV
Renewal (these estimates were not affected by subsequent amendments to Form ADV). We therefore calculate the revised burden per adviser as follows:
(((.25 x 16,442 RIAs) x ($774 x 11 hours)) + ((0.50 x 16,442 RIAs) x ($730 x 9 hours))) / 16,442 RIAs = $5,413 per adviser.
10. We do not apply the full initial burden to current RIAs, as we believe that current RIAs have generally already incurred the initial burden of preparing Form
ADV. For expected new RIAs, we estimate that they will incur the full revised initial burden, which is 30.72 hours per RIA. Therefore, 30.72 hours x 385
expected new RIAs = 11,827 aggregate hours for expected new RIAs. We do not amortize this burden for expected new RIAs because we expect a similar
number of new RIAs to incur this initial burden each year. Therefore, the total revised aggregate initial burden for current and expected new RIAs is 11,827
aggregate initial hours.
11. 12.20 amendment hours x (16,442 current RIAs + 385 expected new RIAs) = 205,289 hours.
12. For current RIAs, we are not applying the currently approved external cost for initially preparing Part 2, because we believe that current RIAs have already
incurred that initial external cost. For current RIAs, therefore, we would only calculate an annual external cost estimate when a Form ADV amendment
imposes a new burden on RIAs. For expected new RIAs, we apply the currently approved external cost for initially preparing Part 2. Therefore, $5,413 per
expected new RIA x 385 = $2,084,005 aggregated for expected new RIAs. We do not amortize this cost for expected new RIAs because we expect a similar
number of new RIAs to incur this external cost each year. Therefore, the aggregated external cost for RIAs is $2,084,005.
13. Based on Form ADV data as of December 31, 2025, we estimate that 10,500 current RIAs provide advice to retail investors and are therefore required to
complete Form CRS, and we estimate an average of 725 expected RIAs to be advising retail investors and completing Form CRS for the first time annually
(“expected new retail RIAs”). The number of expected new retail RIAs to be advising retail investors is higher than the number of expected new RIAs because
we anticipate some current RIAs as well as some new RIAs will be advising retail investors for the first time and thus be required to complete Form CRS.
14. See Form CRS Relationship Summary; Amendments to Form ADV, Investment Advisers Act Release No. 5247 (June 5, 2019) [84 FR 33492 (Sept. 10,
2019)] (“2019 Form ADV PRA”). Since advisers have been required to comply with the Form CRS requirements for more than three years, we are no longer
applying the amortized initial burden to current advisers that are required to file Form CRS. Instead, we are applying the amortized initial burden of 6.67 hours
to the expected new retail RIAs that will be completing Form CRS for the first time.
15. We estimate that there are 10,500 advisers that provide retail advice to clients and filed a total of 18,559 other-than annual amendments. 18,559 otherthan-annual amendments / 10,500 advisers with retail clients = 1.77 amendments per adviser. 10,500 advisers with retail clients x 1.77 amendments per
adviser x 1 hour = 18,585 hours. 18,585 hours / (10,500 advisers with retail clients + 725 estimated new retail advisers) = approximately 1.66 hours per
adviser.
16. See 2026 Form ADV PRA Renewal.
17. We estimate that the initial burden of completing Form CRS for expected new retail RIAs that will be advising retail investors is 725 expected advisers x
20 hours = 14,500 hours. For expected new retail RIAs initially filing Form CRS each year, we are amortizing this initial burden estimate over three years to
reflect the anticipated period of time that advisers will use the form. Therefore, 14,500 hours / 3 years = 4,833.33 aggregate initial hours for expected new
retail RIAs to initially prepare Form CRS.
18. 1.66 hours x (10,500 current RIAs updating Form CRS + 725 expected new retail RIAs updating Form CRS) = 18,633.50 aggregate amendment hours per
year for RIAs updating Form CRS.
19. We have previously estimated the initial preparation of Form CRS would require 5 hours of legal services for an estimated quarter of advisers that prepare
Part 3, and 5 hours of compliance consulting services performed by a financial manager for an estimated half of advisers that prepare Part 3. See 2020 PRA
Renewal (these estimates were not amended by the most recent amendment to Form ADV). The hourly cost estimate is $774 and $730 for lawyer fees and
financial management service fees. There is no new estimated annual external cost burden associated with Part 3. Thus, we are not calculating an associated
new annual external cost burden for current advisers filing Form CRS. For expected new retail RIAs that we expect would prepare Form CRS each year, we use
the following formula: (((.25 x 725 expected RIAs preparing Form CRS) x ($774 x 5 hours)) + ((0.50 x 725 expected new retail RIAs preparing Form CRS) x
($730 x 5 hours))) = $2,024,562.50 aggregated cost for expected RIAs. We are not amortizing this initial cost because we estimate a similar number of new
RIAs would incur this initial cost in preparing Form CRS each year.
20. Based on Form ADV data as of December 31, 2025, we estimate that there are 6,389 currently reporting ERAs (“current ERAs”), and an average of 789
expected new ERAs annually (“expected new ERAs”).
21. See 2024 Form ADV PRA.
22. The previously approved average per adviser annual burden for ERAs attributable to annual and updating amendments to Form ADV is 1.5 hours. See
2024 Form ADV PRA. As we have done in the past, we add to this burden the burden for ERAs making final filings, which we have previously estimated to be
0.1 hour per applicable adviser, and we estimated that an expected 470 current ERAs will prepare final filings based on Form ADV data as of October 5,

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2023. 1.5 hours + (0.1 hours x 470 final filings) = 48.50 hours. However, this burden figure was incorrectly calculated in the prior Form ADV PRA submission.
In order to ascertain the per adviser burden, the hourly burden attributable to final filing submissions should have been divided by the sum of the number of
current and expected new ERAs. Thus, the equation should have been 1.5 hours + ((0.1 hours x 470 final filings) / 6,905 current and expected new ERAs) =
1.51 hours.
23. For current ERAs, we are not applying the currently approved burden for initially preparing Form ADV, because we believe that current ERAs have already
incurred this burden. For expected new ERAs, we are applying the initial burden of preparing Form ADV of 3.6 hours. Therefore, 3.6 hours x 789 expected new
ERAs per year = 2,840.40 aggregate initial hours for expected new ERAs. For these expected new ERAs, we are not amortizing this burden, because we expect
a similar number of new ERAs to incur this burden each year. Therefore, we estimate 2,840.40 aggregate initial annual hours for expected new ERAs.
24. The previously approved average total annual burden of ERAs attributable to annual and updating amendments to Form ADV is 1.5 hours. See 2020 Form
ADV Renewal (this estimate was not affected by the subsequent amendments to Form ADV). As we have done in the past, we added to this burden the
currently approved burden for ERAs making final filings of 0.1 hour and multiplied that by the number of final filings we are estimating ERAs would file per year
(675 final filings based on Form ADV data as of December 31, 2025). (1.5 hours x 6,389 currently reporting ERAs) + (0.1 hour x 675 final filings) = 9,651
updated aggregated hours for currently reporting ERAs. For expected new ERAs, the aggregate burden is 1.5 hours for each ERA attributable to annual and
other-than-annual updating amendments to Form ADV x 789 expected new ERAs = 1,183.50 annual aggregated hours for expected new ERAs updating Form
ADV (other than for private fund reporting). The total aggregate amendment burden for ERAs (other than for private fund reporting) is 9,651 + 1,183.50 =
10,834.50 hours.
25. Based on Form ADV data as of December 31, 2025, we estimate that 5,655 current RIAs advise 67,769 private funds and expect an estimated 312 new
RIAs (“expected new private fund RIAs”) will advise 1,960 reported private funds per year. We estimate that 5,921 current ERAs advise 53,353 private funds
and estimate an expected 676 new ERAs (“expected new private fund ERAs”) will advise 2,749 reported private funds per year. Therefore, we estimate that
there are 121,122 currently reported private funds reported by current private fund advisers (67,769 + 53,353), and there will be annually 4,709 new private
funds reported by expected new private fund advisers (1,960 + 2,749). The total number of current and expected new private fund RIAs that report or are
expected to report private funds is 5,967 (5,655 current RIAs that report private funds + 312 expected new private fund RIAs that would report private funds).
26. See 2020 Form ADV PRA Renewal (this per adviser burden was not affected by subsequent amendments to Form ADV). We previously estimated that an
adviser without the internal capacity to value specific illiquid assets would obtain pricing or valuation services at an estimated cost of $37,625 each on an
annual basis. See Rules Implementing Amendments to the Investment Advisers Act of 1940, Advisers Act Release No. IA-3221 (June 22, 2011) [76 F.R.
42949 (July 19, 2011)]. However, because we estimated that external cost in 2011, we used an inflation-adjusted cost of $46,865.74, based on the CPI
calculator published by the Bureau of Labor Statistics at https://www.bls.gov/data/inflation_calculator.htm. As with previously approved PRA methodologies,
we continue to estimate that 6% of RIAs have at least one private fund client that may not be audited. See 2024 Form ADV PRA.
27. Using the Bureau of Labor Statistics CPI calculator, the $37,625 cost from 2011 (see footnote 31) was adjusted to $55,042.33 in the 2026 PRA renewal.
28. Per above, for currently reported private funds, we are not applying the currently approved burden for initially reporting private funds on Form ADV,
because we believe that current private fund advisers have already incurred this burden. For the estimated 4,709 new private funds annually of expected new
private fund advisers, we calculate the initial burden of 1.1 hour per private fund. 1.1 hour per expected new private fund x 4,709 expected new private funds
= 5,180 aggregate hours for expected new private funds. For these expected new private funds, we are not amortizing this burden, because we expect new
private fund advisers to incur this burden with respect to new private funds each year. Therefore, we estimate 5,180 aggregate initial hours for expected new
private fund advisers.
29. Per above, for currently reported private funds, we are not applying the currently approved burden for initially reporting private funds on Form ADV,
because we believe that current private fund advisers have already incurred this burden. We expect advisers to incur the initial burden in the first year and are
therefore not amortizing this burden. For the estimated 4,709 new private funds annually of expected new private fund advisers, we calculate the initial
burden of the 1.1 hours initial burden per private fund. Therefore, 1.1 hours per expected new private fund x 4,709 expected new private funds = 45,180
aggregate hours for expected new private funds. For these expected new private funds, we are not amortizing this burden because we expect new private
fund advisers to incur this burden with respect to new private funds each year. 4,709 aggregate hours for expected new private fund advisers. 5,180 hours x
$553 blended rate = $2,8648,540.
30. As with previously approved PRA methodologies, we continue to estimate that 6% of registered private fund advisers have at least one private fund client
that may not be audited, therefore we estimate that the total number of audits for current and expected new private fund RIAs is 6% x 5,967 current and
expected new RIAs reporting private funds or expected to report private funds = approximately 358 audits. We therefore estimate that approximately 358
registered private fund advisers incur costs of $55,042.33 each on an annual basis (see footnote 26 describing the cost per audit), for an aggregate annual
total external cost of $19,705,154.14.
31. See 2026 Form ADV PRA Renewal.
32. See 2026 Form ADV PRA Renewal.
33. 259,438 aggregate annual hours for current and expected new RIAs (see infra footnote 37) / 23,216 advisers current and expected annually = 11.17
blended average hours per adviser. (16,442 current RIAs + 385 expected new RIAs + 6,389 current ERAs + 789 expected new ERAs = 23,216)
34. $23,813,721.64 aggregate external cost for current and expected new RIAs (see infra footnote 38) / (23,216 current and expected new advisers (see
supra footnote 38) = $1,025.75 blended average hours per adviser.
35. See 2026 Form ADV PRA Renewal.
36. See 2026 Form ADV PRA Renewal.
37. 11,827 hours (internal initial burden for Parts 1 and 2) + 205,289 hours (internal annual amendment burden for Parts 1 and 2) + 4,833.33 hours
(internal initial burden for Part 3) + 18,633.50 hours (internal annual amendment burden for Part 3) + 2,840.40 hours (internal initial burden for ERAs) +
10,834.50 hours (internal annual amendment burden for ERAs) + 5,180 hours (Internal initial burden for private funds) = 259,438 aggregate annual hours
for current and expected new advisers.
38. $2,084,005 (aggregate external cost burden for Parts 1 and 2) + $2,024,562.50 (aggregate external cost for Part 3) + $19,705,154.14 (aggregate
external cost burden for private funds) = $23,813,721.64 revised external aggregate burden estimate.

U.S. Securities and Exchange Commission (SEC)
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13.

Estimated Additional Cost Burden
There are no additional cost burdens.

14.

Annual Cost to the Federal Government
The Commission is in the process of revising its methodology to estimate annualized costs to the

Federal government for all of the Commission’s collections of information. The Commission anticipates
that future extensions of this collection of information will reflect the revised methodology.

15.

Reasons for Changes in Burden Estimates
We are revising our total burden estimates to reflect the proposed amendments and updated

data. We estimate that the annual aggregate burden estimate for Form ADV (Parts 1, 2 and 3) for all
RIAs and ERAs under the proposed rule would be 259,438 hours per year, with an internal cost estimate
of $143,469,214. This would represent an aggregate increase of 7,586 hours and $5,454,575.60 in the
internal cost estimate from the currently approved annual aggregate burden estimates. The aggregate
annual estimated external cost burden of $23,813,721.64 represents an increase of $266,642.50 from the
previously approved estimate of $23,547,079.14.
These changes in burden also reflect the Commission’s revision and update of burden estimates
for all information collections under this OMB control number (whether or not associated with
rulemaking changes), and the Commission requested public comment on all information collection
burden estimates for this OMB control number.

16.

Plans for Publishing Results
The results of any information collection will not be published.

17.

Approval to Omit Display of OMB Expiration Date
We request authorization to omit the expiration date on the electronic version of the form,

although the OMB control number will be displayed. Including the expiration date on the electronic
version of this form will result in increased costs, because the need to make changes to the form may not
follow the application’s scheduled version release dates.
U.S. Securities and Exchange Commission (SEC)
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18.

Exceptions to the Certification for Paperwork Reduction Act Submissions
The Commission is not seeking an exception to the certification statement.

U.S. Securities and Exchange Commission (SEC)
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