All Things FinReg


The staff of the Securities and Exchange Commission’s (SEC) Division of Trading and Markets (Staff) issued a no-action letter on October 29 to the Financial Industry Regulatory Authority (FINRA), which, in effect extends the effective date of recent changes to FOCUS reporting by registered broker-dealers. In August 2018, the SEC adopted amendments regarding, among other things, broker-dealer reporting with respect to reporting of extraordinary gains, the cumulative effect of changes in accounting principles, and comprehensive income reported on broker-dealer annual reports (i.e., Rule 17a-5). The amendments are scheduled to become effective for all filings made on and after November 5, 2018.

In light of the timing of the scheduled effectiveness of the amendments and the time needed for broker-dealers to modify reporting systems to reflect to the changes to the FOCUS report, the Staff issued a no-action letter permitting, in effect, deferral of the effective date of the changes to broker-dealer reporting until December 31, 2018. FOCUS reports filed on or before December 31, 2018, and annual reports for periods ending on or before December 31, 2018, may use the requirements in effect prior to the amendments. FOCUS reports filed after December 31, 2018, and annual reports filed for periods ending after December 31, 2018, will need to be filed in accordance with the amended reporting requirements.