FINRA is changing the way member firms submit to FINRA their annual audited financial statements - a requirement under Securities Exchange Act Rule 17a-5(d).   Effective 11/8/11, FINRA is requiring firms to submit their annual audit report in electronic form.  This requirement is governed by NASD Rule 3170. First One Out. Annual audit reports with a fiscal year ending on or after 9/30/11 are the first batch that must be filed electronically to FINRA.   The new process is discussed in FINRA's October FINRA RegNote 11-46.  FINRA adds that it will no longer accept annual audit reports filed in hard copy form once is has completed the transition to electronic submission, as described in the Notice. Detailed Requirement. Annual audit reports in electronic form are to be submitted via FINRA’s Firm Gateway.  The required format of the filing is Portable Document Format (PDF).   The electronic submission screen on the Firm Gateway will include a list of documents that, if applicable, are required in the audit filing.  This list will assist the firm in ensuring that all required schedules are included in its submission.  Firms should refer to SEA Rule 17a-5 for information regarding B/D annual audit report requirements. SEA Rule 17a-5 further requires that an oath and affirmation page be submitted electronically with each annual audit report.  The person who completes the attached forms attests that, to his or her best knowledge and belief:  (i) the financial statements and schedules are true and correct;  and, (ii) neither the broker or dealer, nor any partner, officer, or director, as the case may be, has any proprietary interest in any account classified solely as that of a customer.  The rule requires that the oath or affirmation must be made before a person duly  authorized to administer such oaths or affirmations, namely:

• For a sole proprietorship, the oath or affirmation must be made by the proprietor;
• For a partnership, by a general partner;
• For a corporation, by a duly authorized officer.

Firms also must maintain a hard copy of the oath and affirmation page with an original manual signature (including raised notary seal, where applicable) as part of their books and records under SEA Rule 17a-4(a), along with the accompanying annual audit report in hard copy form. In the new annual audit electronic filing platform in Firm Gateway, if a firm wishes (or is required by FINRA) to submit an amended annual audit report, when the original audit report was submitted to FINRA electronically, the firm’s assigned Regulatory Coordinator will open a “re-file” window in Firm Gateway to permit the firm to submit the amended filing.  If a firm needs to amend an annual audit report that was previously filed in hard copy form, the amendment must also be submitted in hard copy form. In all cases, amended audit reports must be submitted in their entirety (i.e., an amended filing must include all schedules and information required pursuant to SEA Rule 17a-5, including the oath and affirmation, whether or not such schedules and information have been amended).  FINRA will retain the original audit report filed, as well as all amended filings. Firms will use their current FINRA entitlement user ID and password to access the Firm Gateway and submit their annual audit report.  Firm personnel should contact their firm’s Super Account Administrator (SAA) with any questions regarding how to access Firm Gateway.  For Firm Gateway technical questions, contact FINRA’s Technical Support Group at (301) 869-6699. For further details, go to:   [FINRA RegNote 11-46,  October 2011]