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Ext. PublicationSurprise Examinations and Custody of Private Assets | Podcast
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The Alternative Edge
How can registered investment advisors (RIAs) meet the SEC custody rule without the expense of a full traditional audit? In this episode of Weaver: Beyond the Numbers, host Scott Winkler talks with Matt Kiggins from Inspira Financial about using surprise examinations as a practical alternative. They discuss how these exams safeguard private assets, deliver transparency and create meaningful cost savings for RIAs.
Key Points:
- RIAs can satisfy the SEC custody rule through surprise examinations instead of full financial statement audits.
- Qualified custodians like Inspira Financial provide transparency and cost savings in asset custody.
- Surprise exams test compliance with custody and books-and-records rules, not financial performance.
In the discussion, Scott and Matt explore how surprise examinations can offer significant cost savings for RIAs managing pooled investment vehicles. They emphasize the importance of selecting a qualified custodian to ensure compliance with SEC requirements and discuss the differences between full custody services and safekeeping. Matt highlights, “Once fund managers get their arms around it and realize that it is a fully transparent solution, it becomes a favorable option.”
He further explains that custodians ensure transparency by delivering detailed quarterly statements to investors, thus fulfilling SEC mandates. For smaller advisors managing SPVs and Series LLCs, surprise exams often provide a more practical, cost-efficient alternative to traditional audits.
Discover how this approach can streamline compliance and provide peace of mind for fund managers. Listen to the full episode and subscribe to Weaver: Beyond the Numbers on Apple Podcasts or Spotify for more insights into financial service solutions.
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