To use the “audit approach” relying on rule 206(4)-2(b)(4), must the financial statements be prepared in accordance with U.S. GAAP?
Yes, the financial statements for pooled vehicles must be prepared in accordance with U.S. GAAP in order to meet the requirements of the rule, with some exceptions for non-U.S. funds and non-U.S. advisers. Pooled vehicles organized outside of the United States, or having a general partner or other manager with a principal place of business outside the United States, may have their financial statements prepared in accordance with accounting standards other than U.S. GAAP so long as they contain information substantially similar to statements prepared in accordance with U.S. GAAP. Any material differences with U.S. GAAP must be reconciled. The Division would not recommend enforcement action if that reconciliation is included only in the financial statements delivered to U.S. persons. See generally Goodwin, Proctor & Hoar, SEC Staff Letter, Feb. 28, 1997. The required audit of those financial statements must be by an independent public accountant and meet with requirements of U.S. general
- Are the audited financial statements of a mortgage lender required to be prepared by an independent licensed Certified Public Accountant?
- Why would a private company in the United States choose to prepare its financial statements in accordance with IFRS for SMEs?
- Can CPA practitioners report on financial statements prepared in accordance with IFRS for SMEs?