United States

SEC auditor independence considerations


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The Dodd-Frank Wall Street Reform and Consumer Protection Act requires most advisers of private funds to register with the SEC as investment advisers and to comply with the Investment Advisers Act of 1940. The U.S. Securities and Exchange Commission (SEC) requires registered advisers to maintain certain safeguards to maintain all securities at a qualified custodian. One of the safeguards required under the Act is that the registered investment adviser is subject to surprise examinations. The surprise examinations are required to be conducted by a firm that is registered with the Public Company Accounting Oversight Board (PCAOB) and must be conducted under the independence requirements of the SEC. It is important that the registered investment adviser, PEG fund management and the management of all portfolio companies be aware of the following SEC independence considerations, which are outlined in the attached white paper.