Document Request List - National Futures Association
Document Request List - National Futures Association
Document Request List - National Futures Association
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March 2, 2010<br />
Mr. John Smith<br />
President<br />
CPO, LLC<br />
300 South Riverside Plaza<br />
Chicago, IL 60606<br />
jsmith@cpollc.com<br />
Dear Mr. Smith:<br />
Thank you for taking the time to discuss the upcoming NFA examination, which<br />
we have scheduled for Monday, March 22, 2010. NFA examinations are the<br />
cornerstone of a self-regulatory process that continues to benefit the futures industry by<br />
creating investor confidence and market liquidity. Over the years, NFA has continued to<br />
refine our approach to examinations to make them as fast and efficient as possible. We<br />
view this as a positive, collaborative process in which we support your firm’s<br />
commitment to meet its regulatory obligations.<br />
The following is a listing of documents that has been tailored to your firm's<br />
operations based on NFA's records and pre-examination discussions with you. It is<br />
essential to the efficiency of the audit that these documents be gathered and organized<br />
prior to our arrival on the first day of audit fieldwork. You can further contribute to the<br />
efficiency of the audit process by providing those documents below marked with an<br />
asterisk either electronically or via fax by Monday, March 15, 2010.<br />
In order to assist you in preparing for your examination, NFA recommends that<br />
you listen to a previously recorded webcast entitled “How to Prepare for an NFA Audit”<br />
which is located on NFA’s website at the following link:<br />
http://www.iian.ibeam.com/events/nfas001/24983/.<br />
Though we have tried to make this list as inclusive as possible, we may ask for<br />
additional documents during our visit. By responding promptly to such additional<br />
requests as well as making an Associated Person and Principal available to respond to<br />
300 S. Riverside Plaza Suite 1800 Chicago, Illinois 60606 312.781.1300 800.621.3570 312.781.1467 fax www.nfa.futures.org
questions will further enable NFA to conduct the examination more efficiently. Some of<br />
the documents listed below may not be applicable to your firm, so please identify these<br />
documents upon our arrival. As you gather these documents, please do not hesitate to<br />
contact me at (312) 781-1111 or e-mail me at jjones@nfa.futures.org and I will be glad<br />
to assist you.<br />
COMPLIANCE:<br />
General Firm Information<br />
1. Signed and dated attestation from NFA Self Exam Checklist for the past two<br />
years*<br />
2. Most recent NFA Self Exam Checklist used and related notes<br />
3. Names of FCMs, CPOs, IBs, CTAs that Firm does Business with<br />
4. <strong>List</strong> of Affiliates and Related Entities<br />
5. Exemption Letters (4.7 and 4.12)<br />
6. Firm Procedures manual, including but not limited to Promotional Material<br />
Review Procedures and Sales Practice Supervision Procedures<br />
7. Privacy Policy, Privacy Notice and Opt Out Notice*<br />
8. Ethics procedures and proof of completion of ethics training*<br />
9. Disaster recovery/business continuity procedures*<br />
Registration<br />
1. Articles of Incorporation / Partnership Agreement / LLC Info<br />
2. Stock Certificates / Stock Ledgers / Representation of Ownership<br />
3. Minutes to Board of Directors’ Meetings [last 12 months]<br />
4. <strong>List</strong> of Firm Associated Persons, indicate a) those with discretionary authority<br />
over customer accounts and b) those with supervisory responsibilities<br />
5. <strong>List</strong> of Firm Branch Offices [include APs by branch] and Corresponding Branch<br />
Office Managers<br />
6. Customer/Participant <strong>List</strong>*<br />
7. Customer/Participant Subscription <strong>Document</strong>s (specific clients/participants to be<br />
selected during fieldwork)<br />
8. Bylaw 1101 Procedures<br />
Records<br />
1. Customer/Participant <strong>List</strong>*<br />
2. Customer/Participant Subscription <strong>Document</strong>s (specific customers/participants to<br />
be selected during fieldwork)<br />
3. Firm’s Additional Risk Disclosure Procedures<br />
Cash Activity<br />
1. Cash Receipts/Disbursements Journal for Firm’s Operating Account for<br />
December 1, 2009 through current<br />
2. Bank Statements for Firm’s Operating Account (including deposit slips and<br />
canceled checks) for December 1, 2009 through current<br />
3. Cash Receipts/Disbursements Journal for CPO Aggressive Fund, LP bank<br />
accounts for December 1, 2009 through current<br />
300 S. Riverside Plaza Suite 1800 Chicago, Illinois 60606 312.781.1300 800.621.3570 312.781.1467 fax www.nfa.futures.org
4. Bank Statements for CPO Aggressive Fund, LP for December 1, 2009 through<br />
current<br />
Bunched Orders<br />
1. Firm’s Procedures for Bunched Orders and Split Fill Allocation*<br />
2. Records of Bunched Orders, including but limited to order tickets, trade allocation<br />
schedule, etc… from December 1, 2009 through current<br />
3. Monthly Customer Account Statements (specific accounts to be selected during<br />
fieldwork)<br />
4. <strong>List</strong> of Eligible Accounts for Post-Execution Orders<br />
5. Post-Execution Allocation Origination <strong>Document</strong>s<br />
Promotional Material<br />
1. Firm’s Promotional Material File<br />
a. Print (magazine, newspaper, etc.)<br />
b. Video (tape and script)<br />
c. Radio (tape and script)<br />
d. Direct Mail<br />
e. On-Line Computer (Internet, on-line services, e-mail correspondence)<br />
f. Newsletters<br />
g. Hotlines<br />
h. Seminar Tapes/Materials/Outlines<br />
i. Cover Letters Sent with Customer Statements<br />
2. Supporting documentation for all claims or performance results in Promotional<br />
Materials<br />
3. Supporting <strong>Document</strong>s for Hypothetical or Extracted Performance<br />
Solicitations<br />
1. Tapes of AP Sales Solicitations<br />
2. Scripts or Outlines Used by APs for Training/Sales Solicitations<br />
3. Names of Entities Which Provide Lead <strong>List</strong>s to Firm [include address, phone<br />
number, cost, frequency, etc.]<br />
4. Promotional Materials used by Entities which Provide Lead <strong>List</strong>s to the Firm<br />
Supervision<br />
1. Firm’s <strong>List</strong> of Branch Offices<br />
2. Audit Programs Used for On-Site Visits of Branch Offices<br />
3. Audit Reports Issued to Branch Offices in the Past 2 Years<br />
4. Schedule of Branch Office Audits<br />
5. Reports Issued to Firm/Branch Offices by Other Regulators<br />
6. Customer Complaint File<br />
7. <strong>List</strong> of Disciplinary Actions Taken Against APs<br />
Trading Activity<br />
1. <strong>List</strong> of Proprietary and Non-Customer Accounts*<br />
300 S. Riverside Plaza Suite 1800 Chicago, Illinois 60606 312.781.1300 800.621.3570 312.781.1467 fax www.nfa.futures.org
2. Proprietary and Non-Customer Monthly Carrying Broker Statements (specific<br />
accounts to be selected during fieldwork)<br />
3. Monthly Carrying Broker Statements for Firm Error Accounts for December 1,<br />
2009 through Current<br />
4. Monthly Carrying Broker Statements for Customers (specific accounts to be<br />
selected during fieldwork)<br />
5. Large Trader Reports/<strong>List</strong> of Customers that Trade Reportable Positions<br />
CPO Disclosure <strong>Document</strong><br />
1. Most Recent Disclosure <strong>Document</strong> Provided to Potential Customers*<br />
2. NFA and/or CFTC Comment Letters Received for Disclosure <strong>Document</strong><br />
3. 13-Column (or similar) Spreadsheet for Performance <strong>List</strong>ed in the Disclosure<br />
<strong>Document</strong>*<br />
4. Supporting <strong>Document</strong>ation for Performance <strong>List</strong>ed in the Disclosure <strong>Document</strong><br />
5. Notice of Intended Offering<br />
6. Performance Data Subsequent to Information Reported in the Most Recent<br />
Disclosure <strong>Document</strong><br />
7. Trading Records<br />
CTA Disclosure <strong>Document</strong><br />
1. Most Recent Disclosure <strong>Document</strong> Used to Solicit Potential Customers<br />
2. NFA and/or CFTC Comment Letters Received<br />
3. 13-Column (or similar) Spreadsheet for Performance <strong>List</strong>ed in the Disclosure<br />
<strong>Document</strong>*<br />
4. Supporting <strong>Document</strong>ation for Performance <strong>List</strong>ed in the Disclosure <strong>Document</strong>,<br />
including but not limited to composite performance calculation and individual<br />
performance calculation<br />
5. Customer Monthly Carrying Broker Statements (specific accounts to be selected<br />
during fieldwork)<br />
Affiliates<br />
1. Firm Organizational Chart*<br />
2. General Ledger/Cash Receipts/Disbursements Journal from December 1, 2009<br />
through current<br />
3. Reports from Other Regulatory Agencies Issued to Affiliates<br />
4. Minutes to Board of Director’s Meetings [last 12 months]<br />
5. <strong>List</strong> of Current Intercompany Receivables/Payables<br />
6. Agreement with Affiliate(s) if Expenses are Paid by or on behalf of the Affiliate<br />
FINANCIAL:<br />
CPO Financial Reporting<br />
1. Pool Account Statements sent to participants since last Annual Pool Statements<br />
(specific participant to be selected during field)<br />
2. General Ledger for October 1, 2009 through current<br />
300 S. Riverside Plaza Suite 1800 Chicago, Illinois 60606 312.781.1300 800.621.3570 312.781.1467 fax www.nfa.futures.org
3. Monthly Carrying Broker Statements for the Pool for December 31, 2009 and<br />
January 31, 2010<br />
4. Balance Sheet as of January 31, 2010*<br />
5. Bank Reconciliations and Bank Statements as of January 31, 2010<br />
6. Cash Receipts/Disbursements Journal and Unpaid Invoice File for Pool for<br />
February 1, 2010 through current<br />
7. Participant Subsidiary Ledger for October 1, 2009 through current<br />
8. Fees Worksheets and/or Invoices for October 1, 2009 through current<br />
9. Most Recent Annual Pool Financial Statements<br />
Tom Thomas and Jane Scott of NFA’s Chicago office will be assisting me with<br />
the examination of your firm. Please do not hesitate to contact me with any questions<br />
you may have about the records listed above or about our examination at (312) 781-<br />
1111. Also, if there is any specific information you would like to discuss with us during<br />
the examination or that we can research for you, do not hesitate to let me know.<br />
Once again, we would like to thank you for your cooperation and we look forward<br />
to meeting with you and your colleagues on Monday, March 22, 2010<br />
Sincerely,<br />
John Jones<br />
Field Supervisor, Compliance<br />
300 S. Riverside Plaza Suite 1800 Chicago, Illinois 60606 312.781.1300 800.621.3570 312.781.1467 fax www.nfa.futures.org
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