The SEC and the Commodity Futures Trading Commission (CFTC)—collectively, the Commissions—jointly adopted amendments to Form PF, the confidential reporting form for certain SEC-registered investment advisers to private funds, on February 8, 2024.
Form PF was adopted in 2011, as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. It provides the Commissions and Financial Statement Oversight Council (FSOC) with important information about the basic operations and strategies of private funds and their advisers and has helped establish a baseline picture of the private fund industry for use in assessing systemic risk.
Specific amendments will apply to all Form PF filers and require collection of additional identifying information about their managed private funds. Additional amendments apply specifically to advisers of hedge funds as well as those that advise qualifying hedge funds. Explore how your reporting requirements may be impacted below.
Amendment Impacts
As stated by the SEC, the amendments will:
- Enhance reporting by large hedge fund advisers regarding qualifying hedge funds to provide better insight into the operations and strategies of these funds and their advisers and to improve data quality and comparability
- Enhance reporting of hedge funds to provide greater insight into hedge funds’ operations and strategies, to assist in identifying trends, and to improve data quality and comparability
- Amend how advisers report complex structures to improve the ability of the FSOC to monitor and assess systemic risk and to provide greater visibility for both FSOC and the Commissions into these arrangements
- Remove aggregate reporting for large hedge fund advisers to lessen the burden on advisers and to focus Form PF reporting on more valuable information for systemic risk assessment purposes
The final amendments will become effective one year after publication in the Federal Register, and the compliance date is the same as the effective date.
Reporting Changes
Amendments to the form’s general instructions apply to all Form PF filers and were adopted to improve data quality and comparability to enhance investor protection efforts and systemic risk assessment.
These include amendments that impact:
- Reporting of master-feeder arrangements and parallel fund structures
- Reporting of private fund investments in other funds, also referred to as fund of funds
- Reporting trading vehicles
- Timelines for quarterly filers
Changes for All Form PF Filers: Section 1a and 1b Amendments
Amendments to Sections 1a and 1b of Form PF apply to all Form PF filers and were designed to improve comparability across advisers, improve data quality, and reduce reporting errors.
They were adopted to provide greater insight into the operations and strategies of private funds and to assist in identifying trends, including those that could create systemic risk, to enhance investor protection efforts.
These include amendments to collect additional identifying information on the adviser and its related persons—as well as their private fund assets under management—and require advisers to report additional identifying information about the private funds they manage and other information about the private funds’ assets, financing, investor concentration, and performance.
Changes for Private Advisers to Hedge Funds: Section 1c
Amendments to Section 1c of Form PF apply to private fund advisers that advise hedge funds. The amendments include a requirement for advisers to hedge funds to report certain additional information and the removal of certain questions to streamline reporting and reduce reporting burdens.
Changes for Large Hedge Fund Advisers: Section 2
Amendments to Section 2 of Form PF, which was redesignated from existing Sections 2a and 2b, apply to large hedge fund advisers that advise qualifying hedge funds, such as hedge funds that have a net asset value of at least $500 million.
The amendments include the removal of aggregate reporting questions for large hedge fund advisers and require additional fund-level reporting to enhance investor protection efforts and systemic risk assessment.
Amendments will also require large hedge funds to report:
- More granular information about the reporting fund’s investment exposure
- Open and large position reporting
- Borrowing and counterparty exposure
- Market factor effects
Several additional amendments were adopted, for further detail see the SEC final rule.
We’re Here to Help
To learn more about the SEC and CFTC amendments to Form PF and how they could impact you, contact your Moss Adams professional.