Sep 28, 2021 | News

FINRA/SEC: Small Broker Dealers Audit Report Extension Filing

On February 12, 2021 the SEC issued an order extending the deadline for filing the annual audit report by 30 calendar days for certain Broker-Dealers.  This order allows qualifying Broker-Dealers to extend their audit filing deadline from 60 days after fiscal year end to 90 days.  This order was not a one-time extension.

In order to qualify for the annual audit extension, see below

  • Be in compliance with Rule 15c3-1 (Net Capital Rule) as of the Broker-Dealer’s most recent fiscal year-end
  • Have total capital and allowable subordinated liabilities of less than $50 Million as reported in box 3530 of Part II or Part IIA of the Focus Report
  • Is permitted to file an exemption report as part of the Broker-Dealer’s most recent fiscal year-end annual report
  • Must submit written notification to its designated examing authority of its intent to rely on this order on an ongoing basis as long as it meets the conditions of the order
  • Must file the annual report electronically by using SEC’s EDGAR filing system.

The reason behind the extension for smaller broker-dealers include:

  • The use of more manual processes to prepare supporting documentation for the audit or review and response to auditor inquiriies rather than the more automated processes typically used by larger broker-dealers
  • Smaller Broker-Dealers tend to need third-party accountants to assist with financial reporting.  These third-party service providers typically assist multiple broker-dealers with the same fiscal year end resulting in limited capacity during this relatively brief period between Focus Report and Annual Audit Report due dates
  • Some Auditors do not perform interim work of revenue, expenses, and internal controls testing further compressing the time auditors have to perform the required procedures in advance of the filing deadline, including time to resolve any issues that arise

If you would like assistance with filing an extension for the year end audit, please reach out to Mike Coglianese at 630-461-5841 or email