Reporting and Disclosure for Fiduciaries

Reporting and Disclosure for Fiduciaries

You are a financial services professional who owns a dully registered firm with investment advisory and broker-dealer divisions. You have recently decided to partner with a larger firm and provide independent investment advice as part of a larger distribution platform offered by the partner. As a condition of the contractual arrangement, the larger firm needs firm-specific information about your firm’s reporting and disclosure framework for approval by its board of directors and investment committee, as well as review by its compliance department.  What are your firm’s best practices regarding reporting and disclosure for fiduciaries? Inform them of any red flags and/or conflicts of interest of which they should be aware regarding your Form ADV and requisite brochures. And ask them about two types of red flags that would be disclosed in their Form ADV. Describe your business practices, investment analytics or other relevant information that may be found in your ADV brochure. Choose at least two areas to highlight as to why your firm is a good business with which to partner. 


The use of this memorandum is to convince a larger company to partner with our firm for more important investment market since our company is good at reporting and disclosure for fiduciaries.


Our company is dully registered with the law. We perform both advisories, consultancy as well as intermediary (brokerage) functions. We have decided to approach your enterprise for a partnership agreement. We focus on serving a wider and diversified market in financial services. The following are three main areas covered for the purpose of the contractual arrangement.


  1. Reporting and disclosure framework

First of all, we provide our reports in both qualitative and quantitative information. That makes our reports complete, accurate, and easy to read and interpret . The first one is used when preparing budgets and expenditure classifications. The latter is used when structuring strategic plans and objectives, as well as presenting departmental and bureau categorizations.

Furthermore, our disclosure reports contain financial statements to display our net worth regarding assets, liabilities, and equity. An income statement is also present to disclose our profits for the specified period. Other reports such as the declaration of cash flows may also be issued when necessary. We issue the statements to show transparency in our firm.

Lastly, our reports are made on annual basis. That is when our financial year ends. However, just like other businesses, we tend to subdivide the reports into four quarters. They are all used to make the annual complete report. We use quarterly reports to show operational structures, and to show revenues generated by short term strategies.

  1. Disclosure for fiduciaries

            A fiduciary is a person who invests money for his or her beneficiary. The person can as well be termed as a trustee. During reporting and disclosure, we usually provide our clients compliance forms to show the number of trustees our firm has registered. The exercise shows fiduciaries who have agreed and accepted our services.

Also, we issue portfolio management process report regarding the fiduciaries. This report shows how we carry out the activities of registering, interest rate calculation and the method of disbursement of the funds to the beneficiaries. It also shows how we safeguard the clients’ contributions and how new strategies concerning Trusts are implemented.

We ensure our information is accurate by asking them to provide true data. We normally avoid red flags (exposing the firm to problems) especially when the clients are filling the ADV forms. We neglect investments based on corruption and bribery issues. Moreover, we restrict ourselves to due diligence where we undertake all steps to satisfy legal requirements. For instance advising investments which favor human rights or environment preservation.

  1. Business practices

As previously mentioned, our firm practices two leading practices; financial advising, consultancy, and offering intermediary services to the clients. For investment analytics, we focus on the fiduciaries, other medium and long-term investors, and returns from the brokerage activities. We improvise portfolios for people with capital to undertake them. Then we benefit from the returns of their investment.

Our ADV brochures contain a table showing consultancy fees. We also reveal our brokerage charges on the tables. Also, the brochures contain the methods we use to analyze portfolios and remedies for losses in case the plans fail. Finally, we display our disciplinary history, and client referrals as well as compensations.

We believe our firm is the best to partner with your organizations for we have a greater number of clients locally. We are sure our efforts combined will fetch a large number of customers at a higher platform. Secondly, we have qualified personnel who conduct our services well. If we combine expertise with your organization, the output will be great. We will be capable of speculating tricky investment portfolios.


Based on the above discussion, our firm is performing great at the regional level. Our services are accepted by the clients who visit us for advisory and investment consultations. We, therefore, recommend you to take our partnership arrangements and work with us. Together, we will be able to share risks, combine knowledge and skills and diversify to better investment portfolios.

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