Jen: This is the PKF Texas Entrepreneur’s Playbook. I’m Jen Lemanski, and I am back once again with Marty Lindle, one of our audit directors and one of the faces of PKF Texas’ Broker-Dealer team. Marty, welcome back to the Playbook.

Marty: It’s nice to be here.

Jen: So, we’ve talked a little bit about what’s in the eighth annual report. Now, is there anything new coming up on the horizon that’s not in there already?

Marty: Well, the SEC and Congress still haven’t issued the final rules for an inspection program, so we’re still in the interim program.


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Jen: This is the PKF Texas Entrepreneur’s Playbook. I’m Jen Lemanski, and I’m back again with Nicole Riley, an audit senior manager and one of the faces of the PKF Texas Broker-Dealer team. Nicole, welcome back to the Playbook.

Nicole: Great to be back.

Jen: So, the last time you were here we discussed FINRA and the SEC in relation to broker-dealers. Are there common issues that FINRA tends to find when they’re looking at broker-dealers?

Nicole: One of the more common things that we continue to see coming out of these audits that they’re doing, even though the rules have been around since 2003, are issues with expense sharing agreements.


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Jen: This is the PKF Texas Entrepreneur’s Playbook. I’m Jen Lemanski, and I’m back once again with Nicole Riley, one of our audit senior managers and one of the faces of PKF Texas’ broker-dealer team. Nicole, welcome back to the Playbook.

Nicole: Great to be here.

Jen: So, broker-dealer, what is that?

Nicole: So, a broker-dealer is a highly regulated company that traditionally buys and sells securities. That’s really where the name comes from is because they can be selling and buying for a customer where they’re the agent or the broker, or they could be buying and selling for their own accounts where they’re the principal in the transaction or a dealer, hence, broker-dealer.

But really the modern broker-dealer is doing more than just buying and selling securities, they publish investment research, they are helping companies raise capital, they’re helping clients find investments and place their money and they’re also providing investment advice.

Jen: Okay, so you mentioned highly regulated – what does that actually look like?


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