July 2, 2009
Auditing all RIAs each year by an independent CPA is a great idea for any RIA directly billing accounts for fees or that has custody of client accounts. This will greatly help in ensuring that RIAs are not doing anything illegal.
However, doing these audits on a surprise basis I do believe is a bad idea. It is an abrupt change simply to require annual financial audits. The surprise element will cause more problems than it will be worth.
I strongly feel that it will be enough to require of RIAs to have an annual financial audit conducted by a truly independent CPA firm.
President and CEO
Wilbanks Securities, Inc.