FALL 2012

Banking & Securities Update

In this issue
3 Banks
Audit and accounting update
3 FASB: Proposed OCI reclassification guidance
released for comment
3 FAF seeks input on the implementation of Statement
No. 141(R)
3 AICPA issues a Yellow Book independence practice aid
4 FASB proposed expanded liquidity risk and interest
rate risk disclosures
4 FASB moves forward with alternative impairment
model for financial instruments
5 FASB seeks feedback on private company reporting
framework
Regulatory and corporate governance update
6 PCAOB releases inspection process guidance for
audit committees
6 PCAOB issues revised standard on audit committee
communications
6 OCC releases guidance on troubled debt restructurings
7 OCC issues updated guidance on common
accounting issues for banks
7 OCC issues guidance on investor-owned one- to fourfamily residential properties
7 SEC Regulations Committee publishes highlights of
June 27 meeting
7 OCC report discusses risks facing national banks
and federal savings associations
9 Agencies extend comment period on regulatory
capital proposals
9 Joint release: Agencies issue proposed rule on
appraisals for higher-risk mortgages
9 CFPB proposes new mortgage servicing rules
10 SEC staff publishes disclosure guidance for smaller
financial institutions
10 SEC sample letter sent to certain financial institutions
regarding structured note offering disclosures in
prospectus supplements and Exchange Act reports
10 FDIC advisory on effective credit risk management
practices for purchased loan participations

News from the Hill

11 Dodd-Frank Act implementation
11 JOBS Act implementation
12 Tax policy outlook for the presidential election
13 Broker-dealers
Regulatory and corporate governance update
13 PCAOB reports on its interim inspection program for
auditors of brokers and dealers
13 FINRA requests comment on proposed supplementary
schedule for derivatives and other off-balance-sheet items
14 Amendments to SEC Rule 17a-5 and financial
responsibility rules
14 Regulatory Notice 12-36: FINRA and ISG delay effective
date for enhanced Electronic Blue Sheets submissions
14 FINRA modifies proposed rule requiring carrying/clearing
member firms to maintain certain records in a central
location and keep them current
15 FINRA Regulatory Notice 12-25: Additional guidance on
FINRAs new suitability rule
15 CFTC approves new financial rules submitted by NFA to
strengthen the protection of customer funds held by FCMs
16 NFA submits proposed amendments to rules governing
direct reporting to regulators of customer segregated/
secured assets held at approved custody locations
16 SEC approves consolidated audit trail to monitor and
analyze trading activity
16 UK government issues LIBOR discussion paper
16 Basel III capital and liquidity requirements affecting
broker-dealers
17 SEC adopts new compensation committee listing
standards in compliance with Dodd-Frank Act
17 Public Comments on FINRAs Proposed Regulation of
Crowdfunding Activities Available
18 Resources

About this publication

The responsibility for maintaining the integrity and reliability of an organizations financial statements ultimately rests on the audit
committees shoulders. Moreover, audit committees, management, and boards of directors at banks and securities firms must
keep pace with emerging regulations such as current and upcoming accounting pronouncements, and new rules stemming from
the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. Grant Thornton LLPs quarterly Banking & Securities
Update provides brief updates on the key audit, accounting, regulatory and tax issues you need to be familiar with in order to
safeguard the integrity of your organizations financial statements.

Banks

Audit and accounting update

FASB: Proposed OCI reclassification
guidance released for comment

FAF seeks input on the implementation

of Statement No. 141(R)

The FASB proposed for comment an

Accounting Standards Update (ASU),
Presentation of Items Reclassified Out
of Accumulated Other Comprehensive
Income, which would improve the
presentation of reclassifications out of
other comprehensive income (OCI)
by requiring enhanced disclosures in
the financial statements. The proposed
guidance is designed to provide financial
statement users with information
about the amounts reclassified from
accumulated OCI and with a road map
to related financial disclosures. The
proposal was developed in response
to stakeholders concerns about the
significant costs to financial statement
preparers to apply the guidance originally
issued in ASU 2011-05, Presentation of
Comprehensive Income.
The FASB has published an FASB
In Focus article, FASB Proposal on
Improving the Presentation Requirements
for Reclassifications Out of Accumulated
Other Comprehensive Income, to
provide additional information regarding
this proposed ASU.
Comments on the proposal are due
by Oct. 15, 2012.

The Financial Accounting Foundation

(FAF), parent organization of the FASB,
is looking for participants to complete
a survey as part of the foundations
post-implementation review of FASB
Statement No. 141(R), Business
Combinations. The purpose of the
survey is to evaluate the effectiveness of
the accounting standard.
Stakeholders can register to become
survey participants on the FAFs website.

3 Banking & Securities Update Fall 2012

AICPA issues a Yellow Book

independence practice aid

The AICPA has presented a webcast to

help participants understand the Yellow
Book independence practice aid. View
the webcast.
The Government Accountability
Office (GAO) issued standards revising
the Yellow Book effective for financial
audits and attestation engagements for
periods ending on or after Dec. 15, 2012,
and effective for performance audits
beginning on or after Dec. 15, 2011.

The GAOs revisions combine a

Conceptual Framework (Framework)
with certain rules that are outright
prohibitions. It provides more
adaptability in situations and gives
auditors some room to assess unique
circumstances that cannot be addressed
by rules. The new Framework is
consistent with AICPA and International
Federation of Accountants a threats
and safeguards approach based on
facts and circumstances that may be
unique to specific audit environments,
both individually and in the aggregate.
While the AICPA currently does not
require threats to be evaluated in the
aggregate, the AICPA has an exposure
draft that will move their rules closer to
the GAO view. The GAO also requires
documentation to support consideration
of independence, which goes beyond the
AICPAs requirements.
The practice aid illustrates how to
evaluate and document all nonaudit
services in one document for a particular
engagement. It provides detailed
instructions, as well as examples of
nonaudit services and reference to the
particular paragraph in the Yellow Book
that applies in order to evaluate threats
to independence (such as management

participation and self-review threats) that

require safeguards, and how to apply
those safeguards to eliminate threats or
reduce them to an acceptable level. The
practice aid also provides guidance and
examples in order to evaluate whether
management possesses suitable skill,
knowledge or experience (similar to
AICPA ET 101-3), and documentation
of that assessment.
In addition, the practice aid provides
a decision flowchart to assist in the
evaluation process, along with a glossary
of common words and phrases used in
the Yellow Book standards.
FASB proposes expanded liquidity risk
and interest rate risk disclosures

The FASB issued a proposed ASU,

Disclosures about Liquidity Risk
and Interest Rate Risk, to expose
for comment-enhanced disclosure
requirements for certain risks related to
financial assets, liabilities, obligations and
other financial instruments for public,
nonpublic and not-for-profit entities.1
Liquidity risk disclosures
The FASB has proposed certain
liquidity risk disclosures that would
provide information about the risk
that a reporting entity will not meet its
financial obligations. The extent of some
of these disclosures would vary by type
of entity. All entities would be required
to disclose the following information:
Available liquid funds, including
unencumbered cash, high-quality
liquid assets, and borrowing
availability, in a tabular format
Additional quantitative or narrative
disclosure of the entitys exposure to
liquidity risk, including discussion
about significant changes in
the amounts and timing in the
quantitative tables, and how the
entity managed those changes during
the current reporting period

In addition, financial institutions

would be required to disclose:
carrying amounts of classes of
financial assets and financial liabilities
presented in a table and segregated
by expected maturities, including offbalance-sheet financial commitments
and obligations; and
information presented in a table
about time deposit liabilities,
including the cost of funding,
during the previous four quarters
(depository institutions only).
Entities that are not financial
institutions would be required to
disclose expected cash flow obligations
segregated by their expected maturities
but excluding financial assets.
Interest rate risk disclosures
The following proposed interest rate risk
disclosures would apply only to financial
institutions:
Carrying amounts of classes of
financial assets and financial liabilities
according to time intervals based
on the contractual repricing of the
financial instruments
An interest rate sensitivity table that
shows the effects of hypothetical,
instantaneous shifts of interest
rate curves on net income and
shareholders equity
Quantitative or narrative disclosures
of the entitys exposure to interest
rate risk, including discussion about
significant changes in the amounts and
timing in the quantitative tables, and
how the entity managed those changes
during the current reporting period

FASB material contained herein was used with permission and is available at www.fasb.org.

4 Banking & Securities Update Fall 2012

The comment period on the proposed

disclosures ended on Sept. 25, 2012.
To provide constituents with
additional information related to this
proposal, the FASB has released an
In Focus article, FASB Proposal on
Liquidity Risk and Interest Rate Risk
Disclosures, and a podcast recorded by
Board member Marc Siegel.
View the complete article and
podcast.
FASB moves forward with alternative
impairment model for financial
instruments

Using key concepts agreed on jointly

with the IASB, the FASB began
developing an alternative to the threebucket impairment model for financial
instruments at its Aug. 22, 2012, meeting.
The current expected credit losses model
would use a current single-measurement
objective estimate of expected credit
losses rather than the dual-measurement
approach taken in the three-bucket
model. For more information, refer to
the FASBs financial instruments project
update page.

Entities that are not

financial institutions
would be required
to disclose expected
cash flow obligations
segregated by their
expected maturities but
excluding financial assets.

FASB seeks feedback on private

company reporting framework

The FASB has released an invitation to

comment on a FASB staff paper, Private
Company Decision-Making Framework:
A Framework for Evaluating Financial
Accounting and Reporting Guidance
for Private Companies, in order to
solicit feedback on its proposed private
company decision-making framework.
The framework project is not intended
to create an entirely new conceptual
framework for private company financial
reporting. Instead, it is designed to
identify (1) the different needs of users
of private company versus public
company financial statements, and (2)
opportunities to reduce the complexity
and costs involved in preparing financial
statements of private companies in
accordance with U.S. GAAP.

5 Banking & Securities Update Winter

Fall 2012
2011

The staff paper summarizes the

following six factors that differentiate
financial reporting considerations for
private versus public companies:
Types and number of financial
statement users
Access to management
Investment strategies
Ownership and capital structures
Accounting resources
Learning about new financial
reporting guidance
The staff paper also identifies four
areas in which financial accounting and
reporting guidance might differ for
private versus public companies:
Recognition and measurement
Disclosures
Display (presentation)
Effective date

The preliminary framework was

developed by the FASB staff after
consultations with Board members and
discussions with stakeholders who have
had significant and diverse experience
with private company financial
statements. The final framework will be
developed jointly by the FASB and the
Private Company Council.
The comment period ends Oct. 31, 2012.

Banks

Regulatory and corporate

governance update
PCAOB releases inspection process
guidance for audit committees

The Public Company Accounting

Oversight Board (PCAOB) released
Information for Audit Committees
About the PCAOB Inspection Process to
assist audit committees in their oversight
role by clarifying the PCAOB audit
inspection process. This document
includes information on the nature of
a PCAOB inspection of an audit firm
and provides questions about PCAOB
inspections that audit committees
may want to ask their auditors. View
additional details about the guidance.
PCAOB issues revised standard on
audit committee communications

The PCAOB released Auditing Standard

(AS) No. 16, Communications with
Audit Committees, which requires
auditors to provide certain information
to audit committees on a timely basis.
In conjunction with the related and
transitional amendments to existing
PCAOB standards, AS 16 is expected to
enhance auditor communications with
audit committees overall.

6 Banking & Securities Update Fall 2012

The new communications

requirements in AS 16, which remain
subject to SEC approval, will be effective
for audits and quarterly reviews of
financial statements for fiscal years
beginning on or after Dec. 15, 2012 (that
is, fiscal years ending Dec. 31, 2013, for
calendar-year entities, including 2013
quarterly reviews).
The transitional amendments, which
are also subject to SEC approval, will
make the communications requirements
in AU Section 380, Communication with
Audit Committees, apply to audits of
brokers and dealers. Those amendments
will be effective for the periods that
PCAOB standards become applicable
to audits of brokers and dealers (upon
adoption by the SEC of its amendments to
Exchange Act Rule 17a-5), if such periods
precede the effective date of AS 16.

OCC releases guidance on troubled

debt restructurings

The Office of the Comptroller of the

Currency (OCC) released OCC 2012-10,
Troubled Debt Restructurings, to
address numerous queries received
from bankers and examiners on the
accounting and reporting for troubled
debt restructurings (TDRs), especially
for loan renewals and extensions of
substandard commercial loans.
OCC 2012-10 reviews the
authoritative guidance on identifying
a TDR, including the changes codified
in ASU 2011-02, A Creditors
Determination of Whether a
Restructuring Is a Troubled Debt
Restructuring. It also discusses how to
account for the loan after it has been
identified as a TDR.

OCC issues updated guidance on

common accounting issues for banks

SEC Regulations Committee publishes

highlights of June 27 meeting

The views in the Bank Accounting

Advisory Series represent interpretations
by the Office of the Chief Accountant
and are neither official rules nor
regulations of the OCC.
The OCC updated its Bank
Accounting Advisory Series, which
expresses the views of the OCCs Office
of the Chief Accountant on accounting
issues of interest to banks.
The updated series features the
following new or revised questions:
Topic 2A, Troubled Debt
Restructurings, questions 36
through 38
Topic 2B, Nonaccrual Loans,
questions 31 and 32
Topic 2G, Acquired Loans, questions
5 through 8
Topic 4, Allowance for Loan and
Lease Losses, questions 51 and 52
Topic 5A, Other Real Estate Owned,
questions 2 and 34
Topic 5C, Other Miscellaneous
Assets, questions 7 and 8

The highlights of joint meetings between

the Center for Audit Qualitys SEC
Regulations Committee and the SEC
staff summarize issues discussed. The
highlights do not represent official positions
of the AICPA or the CAQ and are not
authoritative positions or interpretations
issued by the SEC or its staff.
The Center for Audit Quality (CAQ)
issued the highlights of the June 27, 2012,
joint meeting of its SEC Regulations
Committee and the SEC staff. Practice
issues discussed include the following:

OCC issues guidance on investorowned one- to four-family residential

properties

On Sept. 17, 2012, the OCC issued

guidance on appropriate credit risk
management practices for investorowned, one- to four-family residential
real estate lending where the primary
repayment source for the loan is
rental income. This recent guidance
discusses policies and processes related
to loan underwriting standards, loan
identification and portfolio monitoring
expectations, allowance for loan and
lease losses (ALLL) methodologies,
and internal risk assessment and rating
systems. View the article.

7 Banking & Securities Update Fall 2012

Restricted cash classification

According to the SEC staff, a
registrant holding cash or short-term
investments in a foreign jurisdiction
where the indefinite reinvestment
assertion has been made would
not be required to classify the cash
and investments as restricted in the
balance sheet.
Pension-related non-GAAP
financial measures If registrants
do not provide sufficient context
with respect to pension-related
non-GAAP financial measures, thus
making the measures potentially
misleading to investors, then those
registrants can expect to receive SEC
staff comments.
Pro forma adjustments that meet
the continuing-impact criterion
The SEC staff indicated that a pro
forma adjustment to the statement
of operations that has more than
a one-time effect would meet the
continuing-impact criterion in
Regulation S-X, Article 11, Pro
Forma Financial Information, even if
the item has an impact for less than
12 months following the transaction.

Interaction of retrospective
adoption of new accounting
standards and registration
statement requirements The
SEC staff said that if a registrant
adopts a new accounting standard
retrospectively in its most recent
interim financial statements, but
does not revise its annual financial
statements prior to filing a new or
amended registration statement
(other than Form S-8), the registrant
should expect a comment from
the SEC asking for the basis for
its conclusion that the impact is
immaterial.
View the highlights of the meeting.
OCC report discusses risks facing
national banks and federal savings
associations

In July 2012, the OCC released its

spring 2012 Semiannual Risk Perspective
report, which discusses top risks facing
national banks and federal savings
associations. The report addresses three
key challenges to the banking system:
the continuing effects of a weak housing
market; revenue challenges related to
ongoing market volatility and slow
economic growth; and the possibility
that banks, in an effort to improve
profitability in a lackluster market, may
take on excessive risks. Key points raised
in the report included the following:
Mortgage overhang Large banks
with extensive mortgage operations
continue to be challenged by the
burden of residential mortgages that
are severely delinquent or currently
being foreclosed upon. This issue
continues to affect the economic
environment for all banks.

 Operational risk As banks try

to boost income and operating
economies of scale, they may try to
spend less on systems and processes.
The use of third-party products
or distribution systems may also
increase this risk.
Asset quality risk While asset
quality indicators are showing
improvement, it has come at a slow
pace. The rate of delinquency for
home loans remains above average,
and although commercial real estate
is showing improvement, it continues
to be plagued by high vacancy rates
and problem assets.
Weak loan growth With the
exception of commercial and
industrial lending, loan growth
remains weak for many banks. As a
result, asset yields banks of all sizes
have been squeezed. Furthermore,
as banks compete for higher-earning
assets, underwriting standards have
also been under pressure.

Domino effects from the European

economy Europe has experienced
a sharp decline in economic growth
given issues with its sovereign debt
and the potential breakup of the
eurozone. Both of these issues have
contributed to weak global economic
activity, increased uncertainty in
financial markets and decreased credit
quality. As a result, large European
and U.S. financial institutions have
experienced an increase in the cost of
long-term debt and equity financing,
which is further hampering market
confidence and economic recovery.3
The report also indicated that levels
of capital across the industry, especially
for larger banks, are strong and of better
quality than before the recession. In

addition, while allowances for loan losses

declined somewhat in 2011, they remain
historically high. Nevertheless, according
to the report, The U.S. banking
industry continues to emerge from the
recession of 2007 [through] 2009 and to
adjust to significant shifts in its operating
and regulatory environments,4 and
banks of all sizes will continue to be
challenged by the operational risks
imposed by these shifts.
The OCCs Semiannual Risk
Perspective report will be released by the
OCC twice a year and will analyze four
main areas: the operating environment;
the condition and performance of the
national banking system; funding,
liquidity and interest rate risk; and
regulatory actions. The current report
reflects data as of Dec. 31, 2011.

Low interest rates As interest

rates remain low, margin upside
has been limited because banks
have been unable to further reduce
funding costs. This environment is
also making banks more susceptible
to rate shocks. In an effort to obtain
higher yields, many banks are adding
to their investment portfolios and
extending the durations of those
portfolios. Furthermore, banks may
face additional risks by entering into
new or less familiar markets to offset
declining revenues.2

3
4

Office of the Comptroller of the Currency. OCC Report Discusses Risks Facing National Banks and Federal Savings Associations. Available at
www.occ.gov/news-issuances/news-releases/2012/nr-occ-2012-106.html.
Ibid.
Ibid.

8 Banking & Securities Update Fall 2012

Agencies extend comment period on

regulatory capital proposals

The three federal banking regulators

the Board of Governors of the Federal
Reserve Board (FRB), the Federal
Deposit Insurance Corporation (FDIC),
and the OCC have extended the
comment period on three notices of
proposed rulemaking (NPRs) that would
revise and replace the agencies current
capital rules.5 The comment period,
which was originally slated to end on
Sept. 7, 2012, was extended until Oct.
22, 2012, to allow interested parties more
time to understand, assess and comment
on the proposals.
The NPR titled Regulatory
Capital Rules: Regulatory Capital,
Implementation of Basel III, Minimum
Regulatory Capital Ratios, Capital
Adequacy, Transition Provisions, and
Prompt Corrective Action seeks to
strengthen risk-based and leverage
capital requirements.
The NPR titled Regulatory Capital
Rules: Advanced Approaches Risk-Based
Capital Rules; Market Risk Capital Rule
would revise the advanced approaches
risk-based capital rules consistent with
Basel III requirements. The proposal
also seeks to apply market risk capital
regulations to thrift institutions and
thrift holding companies.
The NPR titled Regulatory Capital
Rules: Standardized Approach for RiskWeighted Assets; Market Discipline
and Disclosure Requirements proposes
revisions to rules for computing riskweighted assets and was developed in
response to issues raised by the financial
crisis. Additionally, consistent with
Dodd-Frank Act mandates, this NPR
seeks to eliminate reliance on credit
ratings. View the original notice.

Joint release: Agencies issue proposed

rule on appraisals for higher-risk
mortgages

On Aug. 15, 2012, the six federal

financial regulatory agencies the FRB,
the Consumer Financial Protection
Bureau (CFPB), the FDIC, the Federal
Housing Finance Agency, the National
Credit Union Administration, and
the OCC proposed new appraisal
requirements such as the following for
higher-risk mortgage loans:
Defining a higher-risk mortgage loan
as a residential mortgage loan that is
secured by a principal dwelling and
that has an annual percentage rate that
exceeds the average prime offer rate by
1.5%, 2.5% or 3.5%, depending on the
type of mortgage loan
Requiring a lender to take the
following actions before originating a
higher-risk mortgage loan:

Obtain a written appraisal by

a certified or licensed appraiser

who has physically visited the

interior of the mortgaged
property

Have another appraiser

conduct an appraisal that

analyzes any difference in

the sales price, changes

in market conditions, and

improvements made to the

property if the collateral was

acquired by the seller within

180 days of the current

transaction and the property is

being sold at a higher price than

the seller paid

Provide the borrower with a

statement saying that any
appraisal is for the creditors
sole use and that the borrower
may choose to have a separate
appraisal conducted at his or
her expense
Provide the borrower with a
copy of the appraisal without
charge at least three days
before closing

Requiring a creditor to use

reasonable diligence in determining
whether a second appraisal must be
performed
Proposing a safe harbor of steps
the lender should take to confirm
that appraisals are being conducted
according to regulatory and statutory
requirement
This proposed rule is mandated by
the Dodd-Frank Act. The comment
period for the proposal expires on Oct.
15, 2012, and the rule is expected to be
finalized by the end of 2012.
CFPB proposes new mortgage
servicing rules

On Aug. 10, 2012, the CFPB proposed

new mortgage servicing rules to help
protect consumers. Among other things,
the new rules would require mortgage
servicers to provide timely mortgage
statements, give earlier notice of interest
rate increases and guidance about what
to do if payments are not affordable,
correct credit full payments promptly,
and offer options to help borrowers
avoid foreclosures and costly forceplaced hazard insurance. The CFPB will
be accepting comments until Oct. 9,
2012. View the CFPBs summary of the
proposals.

Federal Deposit Insurance Corporation. Agencies Seek Comment on Regulatory Capital Rules and Finalize Market Risk Rule. Available at www.fdic.gov/news/news/press/2012/pr12068.html.

9 Banking & Securities Update Fall 2012

SEC staff publishes disclosure guidance

for smaller financial institutions

The statements in the CF Disclosure

Guidance represent the views of the staff
in the Division of Corporation Finance.
This guidance is not a rule, regulation, or
statement of the Securities and Exchange
Commission. Further, the Commission
has neither approved nor disapproved
its content.
The staff of the SECs Division of
Corporation Finance has published CF
Disclosure Guidance: Topic 5, Staff
Observations Regarding Disclosures of
Smaller Financial Institutions, which
summarizes the staffs observations after
reviewing financial statement disclosures
filed by smaller financial institutions.
These observations cover Managements
Discussion and Analysis, as well as
accounting policy disclosures, and the
following topics:

Allowance for loan losses

Charge-off and non-accrual policies
Commercial real estate
Loans measured for impairment
based on collateral value
Credit risk concentrations
Troubled debt restructurings and
modifications
Other real estate owned
Deferred taxes
FDICassisted transactions

SEC sample letter sent to certain

financial institutions regarding
structured note offering disclosures in
prospectus supplements and Exchange
Act reports

In April 2012, the SECs CorpFin

Office of Capital Markets Trends
issued to certain financial institutions an
illustrative letter that addresses common
issues the SEC staff has noted regarding
structured note offering disclosures in
registration statements and, in some
instances, in Securities Exchange Act of
1934 reports.
The illustrative letter highlights
the following areas in which financial
institutions might enhance their
disclosures regarding future structured
note offerings:
Product names
Product pricing and value
Use of proceeds and reasons for
offerings
Plans of distribution
Liquidity
Issuer credit risk
Tax consequences
Referenced asset or index disclosures
Disclosure formats
Exhibits
For further information, refer to the
SEC staffs sample letter.

FDIC advisory on effective credit risk

management practices for purchased
loan participations

The FDIC issued a Financial Institution

Letter discussing recommended practices
for purchased loan participations
including:
Loan Policy Guidelines for
Participations Procedures
for originating and purchasing
participation loans, requirements for
thorough borrower due diligence,
and a review of the purchasing banks
contractual rights and obligations
should be included in loan policies.
Loan Participation Agreements
A description of the responsibilities
of the lead institution, requirements
for procuring borrower credit
information, procedures for
addressing defaults and dispute
resolution practices should
be contained in a written loan
participation agreement.
Independent Credit and Collateral
Analysis Institutions that purchase
participation loans should follow the
same credit and collateral analysis
procedures it would execute if it
originated the loan.
Due Diligence and Monitoring
of Participations in Out-ofTerritory or Unfamiliar Markets
Management may need to
perform additional due diligence for
participations comprising out-ofterritory loans or credit facilities.

In April 2012, the SECs CorpFin Office of Capital

Markets Trends issued to certain financial institutions
an illustrative letter that addresses common issues the
SEC staff has noted regarding structured note offering
disclosures in registration statements and, in some
instances, in Securities Exchange Act of 1934 reports.

10 Banking & Securities Update Fall 2012

View the letter.

Banks

News from the Hill

Dodd-Frank Act implementation

JOBS Act implementation

Regulatory agencies continue to

implement the nearly 400 rulemaking
requirements and various studies
outlined in the Dodd-Frank Act. As of
Sept. 4, 2012, the SEC, the Commodity
Futures Trading Commission (CFTC),
bank regulators and other agencies had
finalized 131 rules and proposed 135;
however, 132 rulemaking requirements
needed to be proposed.6
The SEC has been charged with
implementing most of the rules
mandated by the Dodd-Frank Act but
has frequently cited lack of resources as
a reason for failing to complete the work
on time. As of Sept. 4, 2012, the SEC had
finalized 30 rules, proposed 45 and had
yet to propose 21.
Bank regulators have finalized only
31 of 135 rules. While 56 rules have been
proposed, another 48 have not.

The Jumpstart Our Business Startups

(JOBS) Act passed by Congress and
signed into law by President Barack
Obama is one of the most significant
changes in securities law in quite some
time. The primary beneficiaries of the
JOBS Act reforms are a new class of
issuers known as emerging growth
companies (EGCs). Title I of the JOBS
Act defines EGCs and covers, among
other things, the reduced regulatory
and disclosure alternatives available to
them. The provisions of Title I became
effective upon enactment of the JOBS
Act, which is expected to greatly
improve many companies access to
capital. Many banks have been on a
quest for additional capital since the
financial crisis began in 2008. The JOBS
Act provides a number of opportunities
that boards of directors and management
of community banks should evaluate.

For banks and bank holding

companies, the threshold for triggering
Exchange Act Section 12(g) registration
has been raised from 500 shareholders to
2,000. The higher threshold will allow
smaller banks to raise capital by selling
stock to new shareholders without
having to register with the SEC. In
addition, employees who have received
their shares in an exempt transaction as
part of an employee compensation plan
are excluded from the shareholder count.
Of course, banks and bank holding
companies that are EGCs and want to
raise capital through an IPO now have
the option of going public with a lighter
compliance burden. They can follow less
stringent financial statement reporting
and disclosure requirements in their
initial equity registration statement.
They will also be subject to fewer
Sarbanes-Oxley reporting requirements.
These looser standards will apply until
the institution no longer qualifies as an
EGC. Either option should aid in raising
much-needed capital.

Davis Polk & Wardwell LLP. Dodd-Frank Progress Report, Sept. 4, 2012. Available at www.davispolk.com/Dodd-Frank-Rulemaking-Progress-Report/.

11 Banking & Securities Update Fall 2012

 One of the most notable aspects

of the JOBS Act for banks and bank
holding companies is the increase in
the threshold under which they may
deregister with the SEC from 300
shareholders to 1,200 (the threshold
remains at 300 for all other types of
companies). SNL Financial estimates
that there are approximately 300
reporting banks in the United States
that currently have fewer than 1,200
shareholders and thus are eligible to
deregister with the SEC and cease
adhering to the agencys reporting
obligations.7 This increased threshold
reduces annual costs for qualifying
banks and bank holding companies
because they wont have to file
periodic forms such as Forms 10-Q or
10-K under the Exchange Act. Some
smaller banks that are publicly held
may consider deregistration to avoid
the time and expense involved with
SEC reporting. In the two weeks after
President Obama signed the JOBS Act,
three banks announced their intent
to deregister as reporting companies,
thereby reducing their annual reporting
and compliance costs.

A number of new rules have yet to

be promulgated by the SEC. These
rules would:
increase the offering threshold for
Regulation A filings from $5 million
to $50 million or create a new
exemption similar to Regulation A
with the $50 million threshold before
SEC registration is required (there is
no deadline for rulemaking);
end an SEC ban on small company
advertisements to solicit capital
in private offerings that rely on
Regulation D or Rule 144A (rules
were required by July 4, 2012, and
SEC proposed rules were issued on
Aug. 29, 2012);
allow the solicitation of funds over
the Internet, known as crowdfunding
(rules are required by December 2012),
through the Capital Raising Online
While Deterring Fraud and Unethical
Non-Disclosure Act of 2012 or the
CROWDFUND Act ; and
raise the mandatory registration
requirement for private issuers from
500 to 2,000 shareholders or 500
non-accredited investors (there is no
deadline for rulemaking).

The JOBS Act also instructed the

SEC to study the impact on IPOs of:
the transition to decimalization in
this context, the trading and quoting
of securities in penny increments; and
decimalization relative to the
liquidity of small- and middlecapitalization securities.
In addition, the SEC was asked to
determine whether there is sufficient
economic incentive to support the trading
of small- and middle-capitalization
securities. The SEC report, issued on July
20, 2012, opposed increasing tick sizes
but recommended further study of the
issue. Read the report.
Tax policy outlook for the presidential
election

Taxes are emerging as a major campaign

issue, and the outcome of the election will
likely affect how tax matters are addressed.
Pertinent legislative action remains unlikely
during the campaign.
View a comparison of the candidates
tax platforms.

Key Dodd-Frank Act timeline for the rest of 2012/early 2013

SeptemberDecember
Five banking regulators will try to finalize the Volcker rule by the end of 2012, according to news reports.
The FRB plans to finish writing stricter standards for systemically important financial institutions, or SIFIs.
The FRB expects to release a proposal to impose new fees on SIFIs, whether the institutions are banks or not.
The FRB plans to release proposals to implement two oversight requirements for SIFIs other than banks.
SeptemberJanuary
Final rules on credit risk retention may be released. The CFPB may finish the ability-to-repay rule before then; that rule is expected to be finalized by January 2013.
SeptemberOctober
Banking regulators are expected to issue a report that will describe allowable investment activities for banks; this report is required by Section 620 of the Dodd-Frank Act.
OctoberDecember
Rules on margin standards for swaps are expected from the CFTC, the SEC and bank regulators.

SNL Financial. www.snl.com/.

12 Banking & Securities Update Fall 2012

Broker-dealers

Regulatory and corporate governance

update
PCAOB reports on its interim inspection
program for auditors of brokers
and dealers

On Aug. 20, 2012, the PCAOB released

its first report on the progress of its
interim inspection program for auditors
of brokers and dealers, providing an
overview of the new program and the
audit deficiencies identified in the initial
group of inspected audits.
In this first assessment, carried out
over a five-month period from October
2011 through February 2012, PCAOB
inspectors reviewed 10 audit firms,
covering portions of 23 audits of brokers
and dealers registered with the SEC. The
PCAOB identified deficiencies in all of
the audits inspected.
These audits were required to be
conducted under GAAS as issued by
the AICPA and not under PCAOB
standards.

13 Banking & Securities Update Fall 2012

The resultant PCAOB Report on

the Progress of the Interim Inspection
Program Related to Audits of Brokers
and Dealers describes deficiencies
observed in the following areas:
Audit procedures related to the
computation of customer reserve and
net capital requirements
Audits of financial statements
Auditor independence
During the interim inspection
program, the PCAOB expects to review
approximately 100 audit firms and
cover portions of more than 170 audits
of brokers and dealers through 2013.
The program is currently designed to
include a cross-section of audits of
SEC-registered brokers and dealers.
The PCAOB will continue the interim
inspection program until new rules for a
permanent program become effective.
View the full article and the complete
interim report.

FINRA requests comment on proposed

supplementary schedule for derivatives
and other off-balance-sheet items

On Feb. 9, 2012, the SEC approved

Financial Industry Regulatory Authority
(FINRA) Rule 4524, Supplemental
FOCUS Information, under which
applicable carrying and clearing firms
must file operational or financial
schedules or reports that FINRA
believes to be necessary or appropriate
to protect investors or the public interest
as supplements to FOCUS reports.
Accordingly, on May 4, 2012, FINRA
issued Regulatory Notice 12-23, which
called for comment on the authoritys
proposed supplementary schedule for
derivatives and other off-balance-sheet
items (OBS schedule). This schedule
would need to be filed within 22 business
days of calendar quarter-end.

 After the financial crisis hit, FINRA

began monitoring carrying and clearing
firms leverage and liquidity closely, and
gathering other information pertinent
to these firms proprietary positions and
their financing and off-balance-sheet
transactions. FINRAs aim in proposing
the OBS is to obtain more consistent
and comprehensive information
about carrying and clearing firms offbalance-sheet assets, liabilities and other
commitments. Ultimately, FINRA is
looking to make more effective ongoing
assessments of the impact that offbalance-sheet activities have on clearing
and carrying firms leverage, capital,
liquidity and ability to protect customers.
Under the proposed reporting
requirements, firms would have to
disclose their gross exposures in financing
transactions such as collateral swaps,
along with repurchase agreements,
reverse repurchase agreements and other
transactions whose values are netted under
GAAP or held to maturity. Firms would
report their interests in and exposures
to variable interest entities. In addition,
the OBS schedule would require firms
to disclose their non-regular way settling
transactions, including those involving
to-be-announced securities and those
with delayed settlement or delivery. Firms
would also have to report underwriting
and other financing commitments, and
gross notional amounts in centrally and
non-centrally cleared derivatives contracts
involving commodities, equities, interest
and foreign exchange rates, and credit
default swaps.
The comment period ended June 4,
2012. Implementation is expected in
early 2013.8
View the notice and comments
submitted.

Amendments to SEC Rule 17a-5 and

financial responsibility rules

Although the effective date that was

originally proposed Dec. 31, 2011
has passed, the SEC, in consultation
with the PCAOB, has yet to issue its
final amendments to SEC Rule 17a-5.
Comment letters from industry
professionals seeking clarification on
the proposed amendments have raised
concerns. The SEC has asked industry
groups to develop a workable framework
for addressing some of those concerns.
One of the outstanding issues is
how to create a framework for defining
material noncompliance under the
financial responsibility rules, along with
the concept of material weakness as it
relates to the net capital calculation, the
customer reserve formula, possession
or control standards, SEC Rule 17a-13
mandates, and customer statements.
The net capital and customer
reserve calculations are derived from
the firms financial information, and
noncompliance may be easiest to
measure within those two categories.
Different views have arisen with
regard to what constitutes material
noncompliance. Some constituents
believe that noncompliance or material
noncompliance occurs only if a brokerdealer fails the net capital test or fails
to make the deposit that is required to
satisfy its customer reserve formula,
resulting in a hindsight deficiency.
The financial responsibility rules
do not have quantitative requirements
such as those pertaining to possession
or control, quarterly security
verification, or mailing and reporting
of customer statements. Frameworks
to measure noncompliance or material
noncompliance may involve benchmarks
such as excess capital or total securities
as a percentage of securities held by the
depository institution. Discussions about
these topics are continuing.

Regulatory Notice 12-36: FINRA and

ISG delay effective date for enhanced
Electronic Blue Sheets submissions

FINRA and the other interested members

of the Intermarket Surveillance Group
(ISG) have extended the effective dates
for firms to submit new data elements for
Electronic Blue Sheets. These extensions
correspond to the recent SEC extension
of the compliance dates for Rule 13h-1
(the Large Trader reporting rule).
Effective Nov. 30, 2012, and May 1,
2013, firms must begin submitting the
additional formats of Blue Sheets data
specified in Regulatory Notice 11-56 to
FINRA and the other ISG interested
members. These extensions will allow
broker-dealers additional time to develop,
test and implement the enhancements.
FINRA modifies proposed rule requiring
carrying/clearing member firms to
maintain certain records in a central
location and keep them current

FINRA has modified Proposed Rule

4516 requiring each carrying or clearing
member firm to maintain certain records
in a central location and keep them
current in order to facilitate a faster
and more orderly transfer of customer
accounts to another broker-dealer
should the member firm no longer
continue to operate.
Industry concern regarding the
original version of Proposed Rule 4516
surfaced after the Lehman Brothers
bankruptcy. More recently, FINRA
has taken issue with MF Global, which
has had a number of problems with the
transfer of information such as customer
statements and positions, and other
client information.

Financial Industry Regulatory. Supplemental FOCUS Information. Available at www.finra.org/web/groups/industry/@ip/@reg/@notice/documents/notices/p126237.pdf.

14 Banking & Securities Update Fall 2012

 The original version of Proposed

Rule 4516 generated a high volume of
responses by brokers who disagreed with
FINRA about the need for this mandate,
which would have required all brokers
to have a system to document where all
of their books and records were located
relative to the transfer of customers
positions. In response to brokers
concerns, the rule has been modified to
apply only to firms whose total customer
reserve formula credits exceed $100
million as determined pursuant to SEC
Rule 15c3-3.
FINRA Regulatory Notice 12-25:
Additional guidance on FINRAs new
suitability rule

In May 2012 FINRA issued Regulatory

Notice 12-25 to provide additional
guidance on the rule in response
to industry questions prior to the
implementation on July 9, 2012. FINRA
Regulatory Notice 12-25 discusses
the new FINRA Rule 2111 that
requires, in part, that a broker-dealer
or associated person have a reasonable
basis to believe that a recommended
transaction or investment strategy
involving a security or securities is
suitable for the customer, based on
the information obtained through
the reasonable diligence of the [firm]
or associated person to ascertain the
customers investment profile. In
general, FINRAs new suitability rule
retains the core features of the previous
NASD suitability rule, NASD Rule
2310. In addition, Rule 2111 codifies
several important interpretations of the
predecessor rule and imposes a few new
or modified obligations. View the notice.

15 Banking & Securities Update Fall 2012

CFTC approves new financial rules

submitted by NFA to strengthen
the protection of customer funds held
by FCMs

On July 13, 2012, the CFTC approved

new financial rules submitted by the
National Futures Association (NFA)
that enhance the protection of customer
funds held by futures commission
merchants (FCMs). The new rules are set
forth in NFA Financial Requirements
Section 16 and in an Interpretive Notice
titled NFA Financial Requirements
Section 16 FCM Financial Practices
and Excess Segregated Funds/Secured
Amount Disbursements.
The new NFA rules require FCMs
to strengthen their controls over the
treatment and monitoring of funds held
for customers trading on U.S. contract
markets (excess segregated accounts)
and funds held for foreign futures
and foreign option customers trading
on foreign contract markets (Part 30
secured accounts). Three areas of reform
included in the NFA rules are as follows:
(1) Part 30 secured accounts
FCMs must hold sufficient funds in Part
30 secured accounts to meet their total
obligations to customers who trade on
foreign markets. FCMs should calculate
total balances owed to customers using
the net liquidating equity method. FCMs
will no longer be permitted to use the
alternative method, which had allowed
them to hold a smaller amount of funds
that represented the margin on foreign
futures.

(2) Controls over the treatment of

excess segregated and Part 30 secured
customer funds
FCMs must maintain written
policies and procedures regarding
the maintenance of excess (i.e.,
proprietary or residual) funds in
customer segregated accounts and
Part 30 secured accounts.
Any withdrawals that are in excess
of 25% of the excess segregated or
Part 30 secured funds that are not
for the benefit of customers must
be preapproved in writing by senior
management.
FCMs must inform the NFA of any
withdrawal of 25% or more of the
excess segregated or Part 30 secured
amounts that are not for the benefit
of customers.
(3) Reporting and recordkeeping
FCMs must file segregation and Part 30
secured amount computations with
the NFA each day.
FCMs must file detailed information
with the NFA regarding the
depositories holding customer funds
and the investments made with
customer funds as of the 15th and last
business days of each month.
FCMs must file additional monthly
net capital and leverage information
with the NFA.
In addition, Section 16 and the
Interpretive Notice outline the process
by which the NFA can initiate a
Membership Responsibility Action
against an FCM that may not have
sufficient funds to maintain targeted
amounts of excess segregated and Part 30
secured funds. View the article.

NFA submits proposed amendments

to rules governing direct reporting to
regulators of customer segregated/
secured assets held at approved
custody locations

The NFA submitted proposed

amendments to Financial Requirements
Section 4 to the CFTC. These
amendments would require FCMs to
provide their designated self-regulatory
organization (SRO) with online readonly access to bank accounts containing
FCM customer segregated/secured funds.
Further, the proposed amendments would
add Regulation 1.49 to the list of CFTC
regulations that are also considered to
be NFA requirements in the event of a
violation by FCMs, retail foreign exchange
dealers or introducing brokers. The
NFAs board of directors approved both
amendments on Aug. 16, 2012. The NFA
submitted the proposed amendments to
the CFTC on Aug. 21, 2012. The CFTC
is currently in the process of reviewing the
proposed amendments. View the complete
NFA letter.

16 Banking & Securities Update Fall 2012

SEC approves consolidated audit trail

to monitor and analyze trading activity

UK government issues LIBOR

discussion

On July 11, 2012, the SEC approved a

new rule requiring the national securities
exchanges and FINRA to establish a
marketwide consolidated audit trail
that will enhance regulators ability to
monitor and analyze trading activity.
The new rule requires the exchanges
and FINRA to jointly submit a
comprehensive plan detailing how they
would develop, implement and maintain
a consolidated audit trail that must
collect and accurately identify every
order, cancellation, modification and
trade execution for all exchange-listed
equities and equity options across all
U.S. markets.
Currently, there is no single
database of comprehensive and readily
accessible data regarding orders and
executions. Each SRO instead uses its
own separate audit trail system to track
information relating to orders in its
respective markets. Existing audit trail
requirements vary significantly among
markets, which means that regulators
must obtain and merge large volumes
of disparate data from many types of
entities when analyzing market activity.
FINRA will work with other SROs
to submit a national market system plan
that will help close regulatory data gaps.
View the SEC article.

On Aug. 10, 2012, the UK government

launched a discussion paper outlining
initial proposals for reforming the
framework for setting and governing
LIBOR. The paper sought responses
from a variety of market experts and
international stakeholders over a fourweek period that ended on Sept. 7, 2012.
The paper offered preliminary analysis
concerning:
the role that LIBOR plays in the
financial markets;
the flaws in the current structure of
setting LIBOR and its governance
and oversight; and
a range of options for reform,
including the issue of transition.
The UK government was expected
to report in time for changes to be
addressed in legislation. It continues to
work in concert with its international
partners to formulate a globally
consistent solution. View the full article.
Basel III capital and liquidity
requirements affecting broker-dealers

Grant Thornton hosted a brokerdealer symposium on June 19, 2012, at

which several broker-dealer industry
professionals discussed the effects of
the recent financial crises on the global
regulatory framework for financial
firms. The Basel Committee on Banking
Supervision has adopted the global
regulatory standard known as Basel III,
which covers bank capital adequacy,
stress testing and market liquidity
risks. The Basel III initiative will put
additional pressure on broker-dealers
profitability, and particularly on returns
on equity (ROE), given the increased
capital and margin requirements. Balance
sheet assets will also be reduced because
of increased leverage requirements.

 One of the challenges broker-dealers

are facing under Basel III is how to
replace or increase their revenues to
maintain the ROE that shareholders have
come to expect. From a sales practice
perspective, regulators are concerned
that new products originally developed
for institutional clients are now being
sold perhaps inappropriately to
retail customers.
Regulators have been challenged to
find the appropriate model to determine
the amount of capital that has to be
maintained by broker-dealers. The
value-at-risk model for trading assets
is currently in use. As a result, the SEC
and the CFTC have set minimum capital
requirements. Under its Consolidated
Supervised Entity program, the SEC
requires that broker-dealers have at
least $5 billion in tentative net capital
(i.e., net liquid assets). However, this
proved to be insufficient in the case of
Lehman Brothers in 2008, when a lack of
liquidity exposed the firms inability to
realize its measured fair value. FINRA
is now focusing much more closely
on liquidity, asking firms to maintain
sufficient liquidity at the broker-dealer
level rather than at the holding company
and to perform stress testing to ensure
liquidity is available when needed.
While there are currently no definitive
SEC rules governing liquidity, industry
experts expect to see some liquidity
rules for securities-based swaps dealers
proposed by the end of the year.

Regulators have been

challenged to find the
appropriate model to
determine
the amount of capital that
has to be maintained by
broker-dealers.

17 Banking & Securities Update Fall 2012

SEC adopts new compensation

committee listing standards in
compliance with Dodd-Frank Act

Public Comments on FINRAs Proposed

Regulation of Crowdfunding Activities
Available

The SEC approved a final rule directing

national securities exchanges and
national securities associations to
establish listing standards that require
an issuers compensation committee to
consist only of independent members of
the board of directors.
Additionally, listing standards are
required to address the following matters
related to an issuers compensation
committee:
The committees authority to retain
compensation advisers
The committees consideration of the
independence of any compensation
adviser
The committees responsibility for
the appointment, compensation and
oversight of the work done by any
compensation adviser

This final rule was issued to comply
with Section 952 of the Dodd-Frank Act
and became effective on July 27, 2012.
View the final rule.

When the JOBS Act was signed into

law, it established provisions for
crowdfunded securities under the
Capital Raising Online While Deterring
Fraud and Unethical Non-Disclosure
Act of 2012 or the CROWDFUND
Act. The CROWDFUND Act permits
issuers to sell up to $1,000,000 worth of
securities via crowdfunding within a
12-month period without registering
with the SEC. Furthermore, under
the new law, intermediaries operating
funding portals are exempt from
registering with the SEC as a broker.
However, they are subject to the
SECs examination, enforcement
and rulemaking authority, and they
must register with an applicable selfregulatory organization.
In June 2012, FINRA issued a
regulatory notice seeking comments
on the proposed regulation of
crowdfunding activities. The comment
period expired on August 31, 2012. Read
the Full Notice and comments received
by FINRA.

Resources
We provide a number of articles and webcasts on financial reform and other topics affecting the banking and securities industries.
Our thought leadership includes the following:
Top 10 ways banks can grow in 2012 During recent years, consumers and businesses alike have been in survival mode.
Many industries, including banking, have cut costs to weather the recession. However, austerity alone will not lead to longterm growth. This Grant Thornton white paper asserts that even in the midst of challenges, banks can take steps to grow.
Broker-dealer industry update Articles provide highlights of Grant Thornton roundtable events that focus on hot topics in
the broker-dealer industry.
Banking industry hot topics Articles summarize roundtable events hosted by Grant Thornton to discuss important
developments in the banking industry.
Merger and acquisition services for banks As advisers to the banking industry, we help clients initiate and execute M&A
transactions in todays dynamic global market.
Financial Bulletin This electronic publication covers regulations and developments affecting the financial services industry.
Continual stress tests: Peace of mind for banks and regulators The Federal Reserve Bank has required 19 of the countrys
largest banks to file comprehensive capital plans and perform stress testing in order to evaluate how their operations would
hold up during another economic crisis. This paper details additional key actions decision-makers can use to help manage
liquidity and solvency expectations throughout many types of economic cycles.
Making ERM work for your institution In the wake of the financial crisis, corporate risk has received unprecedented
national exposure, with stakeholders, rating agencies, governance organizations, stock exchanges and the media all sharpening
their focus on enterprise risk management (ERM) and its role within institutions today. Despite this sharpened focus, though,
many institutions are still struggling to implement ERM successfully. This issue of Currency outlines steps you can take to
establish an ERM program that fits the needs of your institution.
New Developments Summary Periodic bulletins provide detailed summaries of recent technical developments and accounting
pronouncements.
Currency Grant Thorntons electronic newsletter for bank executives is published periodically and covers issues and trends affecting
financial institutions.
Allowance for loan and lease losses (ALLL) adjustment factors The ALLL for a bank has several components. The primary
components consist of loans collectively evaluated for impairment (the FAS 5 component), loans individually evaluated for impairment
(the FAS 114 component), and loans acquired with deteriorated credit quality (the SOP 03-3 component). This paper focuses on the
FAS 5 component of the allowance.
Visit www.GrantThornton.com/financialservices for more information.

18 Banking & Securities Update Fall 2012

Banking and Securities practice upcoming events

Date and time
Oct. 24, 2012 4:307 p.m. EST

Name
Broker-Dealer Industry Hot Topics Symposium (New York, N.Y.)

Type
Event

Oct. 25, 2012 34:30 p.m. EST

The JOBS Act and tick sizes: Decimalization, public policy

and the impact on banks

Webcast

Nov. 1, 2012 23:30 p.m. EST

Compliance, BASEL III, and beyond

Webcast

Nov. 9, 2012 24 p.m. EST

Regulatory risk for bank executives

Webcast

Nov. 28, 2012 4:307 p.m. EST

Banking Industry Hot Topics Symposium (New York, N.Y.)

Event

Nov. 30, 2012 2:003 p.m. EST

M&A for banks: Maximizing opportunity as a buyer or a seller

Webcast

Dec. 6, 2012 24 p.m. EST

Banking Industry Update

Webcast

Dec. 7, 2012 24 p.m. EST

Broker-Dealer Industry Update

Webcast

About the publication

This Grant Thornton LLP bulletin provides
information and comments on current
accounting issues and developments.
It is not a comprehensive analysis of
the subject matter covered and is not
intended to provide accounting or other
advice or guidance with respect to
the matters addressed in the bulletin.
All relevant facts and circumstances,
including the pertinent authoritative
literature, need to be considered to
arrive at conclusions that comply with
matters addressed in this document.
Acknowledgements
Molly Curl, Kendra Decker, Karen Elliott,
Richard Flowers, Debra Hahn, Peter Ladas,
Kristen Malinconico, Jamie Mayer,
Tariq Mirza, Mary Moore Hamrick,
Jeff Moskowitz, Eric Stone.
Contact
For additional information about the
topics covered in this document, please
contact your Grant Thornton adviser or
one of the professionals listed below:
Jack Katz
National Managing Partner
Financial Services
T 212.542.9660
E jack.katz@us.gt.com

The information contained herein is general in nature and based on authorities that are subject to change. It is not intended
and should not be construed as legal, accounting or tax advice or opinion provided by Grant Thornton LLP to the reader. This
material may not be applicable to or suitable for specific circumstances or needs and may require consideration of nontax and
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Grant Thornton LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect
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Nichole Jordan
National Banking and Securities
Industry Leader
T 212.624.5310
E nichole.jordan@us.gt.com

Grant Thornton LLP

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19 Banking & Securities Update Fall 2012