Broker-Dealer Accounting Virtual Conference

CONFERENCE AGENDA

Welcome & Opening Remarks
8:45 – 9:00 AM

State of the Brokerage Industry
9:00 – 9:45 AM
This session will provide an overview of the broker-dealer landscape, deliver an update on regulatory initiatives, cover the impact of regulations on capital formation, present related innovations, and offer a glimpse into the future of the broker-dealer industry. Topics to be discussed include:
• Key Regulators of the Securities Industry
• Self-Regulatory Organizations (SROs)
• Equity Market Structure
• Current Issues in Trading Equities
   – The maker-taker model
   – Access fees
   – Market data fees
   – Fragmentation
• Current Proposals to Address Issues in Equity Trading
   – Transaction Fee Pilot Program—market data fees
• Bond Market Structure
   – Issues in bond markets
• SIFMA Capital Committee Focus
• SEC SBSD Rules
• CFTC SD Rules
• SIFMA Actions to Address COVID-19

Break
9:45 – 9:50 AM

Regulatory Trends, Industry Initiatives & Challenges
9:50 – 11:05 AM
Broker-dealer firms continue to be challenged by regulatory, accounting and auditing issues. This session will focus on the challenges faced by the broker-dealer industry and provide insights into the changes and evolution of the market, as well as supply an overview of FINRA priorities and new regulatory guidance for COVID-19. Topics to be discussed include:
• Recent Regulatory Guidance—COVID-19
   – Regulatory relief
      – Net capital treatment of covered loans under the CARES Act
      – Annual assessment and net capital
      – Business Continuity Planning (BCP)
      – Filing extensions: annual reports and FOCUS reports
• COVID-19 Financial Responsibility Rules
   – Prompt transmittal
   – Physical count
   – MMLF Program
• SEC Trading & Markets Staff Requirements for Certain Paper Submissions in Light of COVID-19
   – Manual signature relief
   – Notary relief
• Exemption Reporting
   – Amendments to the Broker-Dealer Financial Reporting Rule
   – Amendments to certain Broker-Dealer Financial Responsibility Rules
   – Exemption Reporting under SEA Rule 15c3-3(k) for purposes of FOCUS Reporting and Updating of
      Membership Agreements
• FINRA Outreach
   – (k)(2)(i) exemption and $5,000 Minimum Net Capital Requirement
   – Prospective changes to membership agreement, exemption report, FOCUS report
   – Discuss with risk monitoring analyst
• (k)(1) Exemptive Provision
• Multiple Business Activities
• Non-Covered Firms
• SEA Rule 15c3-3(e) Exemptive Provisions
   – FINRA risk monitoring, examinations and key topics
• Other Regulatory Guidance

Break
11:05 – 11:10 AM

Technical Accounting Update
11:10 AM – 12:10 PM
• Revenue Recognition
   – Reminder and implementation observations
   – Implementation considerations
• Statement of Cash Flows—Restricted Cash
• Leasing—Topic 842
   – Definition of a lease
   – Key considerations
• Current Expected Credit Losses
• Simplifying the Accounting for Income Taxes (Topic 740)
• Adoption of New Standards
• Rule 15c3-3 Exemptions

Lunch
12:10 – 12:55 PM

SEC Standard of Conduct Rulemakings: Regulation Best Interest & Form CRS
12:55 – 1:55 PM
• Overview
   – Regulation Best Interest (Reg BI)
   – Form CRS
• Retail Customers & Retail Investors
   – Definitions
   – Legal representatives
   – Identifying retail customers and retail investors
• Recommendations
   – Definition
   – Types
• Compliance with Reg BI
   – Care obligation
   – Requirements
   – Recommendation of account types and rollovers
   – Retail customer investment profile
   – Determining and documenting “Reasonable Basis”
   – Significant investments/complex and risky products
   – Disclosure
   – Conflict of Interest obligation
   – Compliance obligation
   – Insights from initial SEC & FINRA exams
• Form CRS
   – Who must receive Form CRS?
   – Delivery and filing requirements
• Books & Records Requirement
• Transitioning from Initial Compliance Period

Break
1:55 – 2:00 PM

Auditing Standards Update
2:00 – 2:50 PM
• Inspection Program Objectives
• Firms Auditing Broker-Dealers
• Inspection Results
• Review Engagements
• Examination Engagements
• Net Capital Rule—Supporting Schedule
• Revenue
• Presentation & Disclosure
• Inspections Status
• Looking Ahead

Comments from the CFTC   
2:50 – 3:50 PM
Regulators from the CFTC will update you on the latest hot button issues and the most effective ways to handle them.

Break
3:50 – 3:55 PM

SEC Enforcement
3:55 – 4:55 PM
• Current SEC Commissioners
• COVID-19-Related Considerations & Risk Factors
• OCIE Annual Examination Priorities
• SEC Enforcement Policy FOCUS:
   – Technology and individuals
   – Actions and penalties
   – Trends and themes
   – Investigations
• Whistleblower Program Update
• Chronology of SEC Investigation Process
• Arsenal of SEC Enforcement Weapons
• Potential SEC Enforcement Penalties
• Focus on the Conduct of Individuals
• Specific Risks for the Initiation of SEC Investigations
• Broker-Dealer-Related Investigation Considerations
• Net Capital Compliance & Recent Rule Enforcement Actions
• Customer Protection Rule
• Books & Records
• FOCUS Reports
• SEC & DEA Notification Requirements
• Failures to Notify Regulators—Enforcement Case
• Cases Against Individual Auditors & Accountants
• Rule 102(e)
   – SEC’s Rules of Practice
   – Accountants’ conduct
• Examples of Rule 102(e) Proceedings
• Best Practices for Accounting and Reporting Compliance
• Common Mistakes Broker-Dealers Make in SEC Investigations
• Litigated Financial Fraud & Auditor Cases

Conference Ends
4:55 PM