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SEC Rule 204-2

Also called the "Books and Records Rule," Section 204-2 requires investment advisers, hedge funds, and private equity firms to make and keep true, accurate and current books and records relating to their investment advisory business.

Rule Overview

Jurisdiction: United States

Regulator: SEC

Topic: Recordkeeping

ECFR Title 17 Part 275
Overview
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Further Reading

Firms must maintain accurate and current records of their advisory businesses, including:

Rule 275.204-2(1)
Accounting records that support entries in the firm's books and ledgers.
Rule 275.204-2(2)
General and subsidiary ledgers showing the firm's assets, liabilities, income, and expenses.
Rule 275.204-2(3)
Records of securities transactions and trading instructions, including any changes or cancellations.
Rule 275.204-2(4)
Banking and cash records, such as checkbooks, bank statements, canceled checks, and cash reconciliations.
Rule 275.204-2(7)
Business communications, including copies of communications sent and received relating to investment recommendations, advice, client funds or securities, or trade activity.
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