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Prepare for SEC Scrutiny of Valuation Practices

April 7, 2021

Foreside’s Tracy Dotolo and Jack Huntington, members of the Fund Officer Solutions team, broke down to BoardIQ why fund boards need to prepare for regulatory scrutiny over handling the fair valuation process’s oversight.

Recently, the SEC charged a pricing service provider and registered investment advisor with compliance deficiencies relating to pricing information delivered to its clients based on single-broker quotes. This highlights why the importance of evaluating third-party pricing services and the need for comprehensive policies and procedures governing such oversight.

Foreside strongly encourages fund boards to use their chief compliance officers and treasurers to monitor progress and provide regular updates to directors throughout the implementation process. Intermediate check-ins with the valuation designee, along with sample reports, should help establish the board’s reporting requirements before the compliance date.

Click here to read more about why boards should take this opportunity to dig into the procedures and controls and ensure their understanding of the process.