Annual Audit Extension of Time Request Policy

The timely receipt of firms' annual audited financial statements is critical to FINRA's ability to carry out its regulatory obligations. FINRA requires firms to file an Annual Audited Report ("annual audit" or "audit") no later than sixty (60) calendar days after the date of a firm's fiscal year end. If a firm needs an extension, it must submit a written request to its assigned FINRA Coordinator no later than three business days prior to the audit due date.

 

For reasons that vary, firms may require an extension of time to file their annual audit. When a firm determines that an extension is necessary, it must submit a written request to its assigned FINRA Coordinator as early as possible—but no later than three business days prior to the audit due date. Firms may make a verbal request for an extension, but it must be followed by:

 

  1. a written request signed by the firm's Chief Financial Officer that includes the amount of additional time being requested and the specific reason(s) for the request; and
     
  2. a letter from the firm's outside independent auditor in which the auditor represents, based upon the work completed on the audit as of the date of the request, that:

    • the firm is in compliance with SEA Rules 15c3-1 and 15c3-3, and, if applicable, CFTC Regulations 1.20 and 30.7;
    • there is no indication that any material inadequacies in the accounting system or internal accounting controls exist;
    • no significant financial or record-keeping problems are apparent; and
    • an unqualified audit opinion is expected to be issued.

 

A request for an extension of time to file the audit will either be granted or denied based upon the specific facts and circumstances in each case. In determining whether to grant an extension of time, FINRA staff may consider factors such as the firm's prior regulatory and filing history (e.g., the filing of materially inaccurate FOCUS Reports, prior late filings of FOCUS and/or annual audit reports or a pattern of extension requests to file the annual audit report, net capital or books and records problems, or concerns regarding customer protection) and other events of potential regulatory concern. Firms are advised to discuss this policy with their outside auditors and, absent unusual or unforeseen circumstances, ensure that sufficient time is allotted to complete the audit within the timeframes required by SEA Rule 17a-5(d).

 

In situations where FINRA deems it appropriate to grant an extension request, the time granted is generally limited to 10 business days. In exceptional circumstances, FINRA may determine that an extension of additional time for the filing of the audited financial statements may be granted, but not to exceed 30 calendar days from the original due date of the audit.