/client-disclosures

name: client-disclosures
description: "Guide which client disclosure documents must exist, what each must contain, and when and how they must be delivered to clients of investment advisers and broker-dealers. Use when the user asks about Form ADV Part 2A or 2B content, Form CRS content and delivery, prospectus delivery obligations, privacy notice delivery, trade confirmation timing, account statement distribution, electronic vs paper delivery compliance, or the content and client-delivery side of the annual brochure update. Also trigger when users mention 'onboarding document checklist', 'what disclosures do we owe new clients', 'brochure supplement for a new adviser', or 'CRS conversation starters'. (For filing mechanics and regulatory deadlines — IARD amendments, Form PF, 13F — use regulatory-reporting; for whether fee disclosure content is adequate, use fee-disclosure.)"

Client Disclosures

Regulatory status current as of June 2026 — verify effective dates, dollar thresholds, and pending rulemakings against current SEC/FINRA/FinCEN sources before advising.

Core Concepts

Form ADV Part 1

Filed electronically via IARD (Investment Adviser Registration Depository). Contains:

• Registration information (SEC, states)
• Form of organization, control persons, and ownership
• Disciplinary history (criminal, regulatory, civil)
• Other business activities and financial industry affiliations
• Custody of client assets
• Participation in client transactions
• AUM and number of clients

Part 1 is publicly available through the SEC's Investment Adviser Public Disclosure (IAPD) website. It is not delivered to clients but is a regulatory filing that must be kept current (annual updating amendment within 90 days of fiscal year end, interim amendments for material changes).

Form ADV Part 2A (Firm Brochure)

The primary disclosure document for RIAs. Must contain 18 items: 1. Cover page 2. Material changes summary (annual update) 3. Table of contents 4. Advisory business description 5. **Fees and compensation** (see fee-disclosure skill) 6. Performance-based fees (if applicable) 7. Types of clients 8. Methods of analysis, investment strategies, and risk of loss 9. Disciplinary information 10. Other financial industry activities and affiliations 11. Code of ethics, participation in client transactions, personal trading 12. Brokerage practices (best execution, soft dollars, directed brokerage) 13. Review of accounts (frequency, triggers, reviewer qualifications) 14. Client referrals and other compensation 15. Custody 16. Investment discretion 17. Voting client securities (proxy voting) 18. Financial information (balance sheet if prepaid fees or custody)

**Delivery requirements:** Initial delivery to prospective clients before or at the time of entering the advisory contract. Annual offer to deliver updated brochure (or delivery of a summary of material changes with an offer to provide the full brochure) within 120 days of fiscal year end. Interim delivery required for material changes that clients should know about.

Form ADV Part 2B (Brochure Supplement)

Provides information about specific supervised persons who provide investment advice:

• Educational background and business experience
• Disciplinary information
• Other business activities
• Additional compensation (from non-clients)
• Supervision structure

Delivered to clients before or at the time the supervised person begins providing advice. Updated for material changes.

Form CRS (Client Relationship Summary)

Required for both RIAs and BDs. Maximum 2 pages (4 for dual registrants). Must follow SEC-prescribed format with specific headings and conversation starters:

**Required sections:** 1. **Introduction** — firm name, registration status (IA, BD, or both), statement that brokerage and advisory services differ 2. **Relationships and Services** — description of principal services, monitoring, investment authority, limited product offerings, account minimums 3. **Fees, Costs, Conflicts, and Standard of Conduct** — principal fees, other costs, conflicts, applicable standard of conduct (Reg BI for BDs, fiduciary for IAs) 4. **Disciplinary History** — yes/no question with link to Investor.gov 5. **Additional Information** — how to find more information, who to contact

**Delivery timing:**

• Before or at the earliest of: (a) entering an advisory or brokerage agreement, (b) opening an account, or (c) making a recommendation of account type, security, or investment strategy
• When opening a new account that is different from existing accounts
• When recommending a rollover from a retirement account
• Upon request
• File with SEC via IARD/CRD

Prospectus and SAI Delivery

**Mutual funds:** Summary prospectus must be delivered at or before the time of sale (point of sale delivery). The summary prospectus must provide access to the full statutory prospectus and SAI (online or upon request).

**ETFs:** No point-of-sale prospectus delivery is required for exchange-traded transactions (SEC Rule 498). However, the prospectus must be available online, and a paper copy must be delivered upon request within 3 business days.

**New issues (IPOs):** Prospectus must be delivered before or with the confirmation of sale.

**Statement of Additional Information (SAI):** Not routinely delivered but must be available upon request. Contains additional detail on investment policies, portfolio turnover, taxation, financial statements, and fund governance.

Regulation S-P (Privacy Notices and Breach Notification)

Regulation S-P (17 CFR Part 248) requires financial institutions to protect customer nonpublic personal information (NPI):

• **Initial privacy notice** — delivered at account opening; describes information collected, information shared, opt-out rights, and security practices
• **Annual privacy notice** — historically required annually; the FAST Act (2015) created an exception: firms with unchanged privacy practices that do not sh