As broker-dealers work to achieve ever greater operational efficiency while preserving accuracy, even incremental regulatory improvements can make a measurable difference in both their day-to-day workflows and bottom lines.
Today, we’re pleased to share that after nearly two years of sustained dialogue and collaboration between ACI leadership and the Securities Investor Protection Corporation (SIPC), the organization earlier this week adopted a $25 materiality threshold for SIPC Agreed-Upon Procedure (AUP) reports.
Under the newly clarified guidance, broker-dealers will no longer be required to amend their SIPC filings for discrepancies of $25 or less. PCAOB auditors may also issue AUP reports even when minor rounding or reconciliation variances occur – an outcome that eliminates friction, reduces cost and streamlines the audit process without diminishing oversight integrity.
Historically, even minimal differences between internal calculations and SIPC’s assessment triggered time-consuming amendments that invited noncompliance risk and resource strain without adding meaningful regulatory benefit. ACI identified this inefficiency, designed a practical proposal and worked directly with SIPC staff and other key stakeholders to craft a framework that regulators and auditors alike could support.
The resulting guidance, now reflected in SIPC’s approach, establishes clear materiality thresholds – $25 for differences in revenue and adjustments, and $1 for certain procedural items – provided that these limits are mutually agreed upon in the engagement letter and disclosed in the AUP Report.
This change marks the first materiality standard in SIPC’s history of AUP reporting – a significant step toward modern, efficient regulatory compliance for smaller firms and a model for how constructive industry dialogue can yield tangible improvements.
As ACI CEO and Managing Partner Jay Gettenberg, who spearheaded the initiative, notes: “As we continue to advocate for thoughtful, operationally efficient regulation, this milestone exemplifies our firm’s ability to influence policy, engage with regulators and drive meaningful change across the broker-dealer community.”
With more than 40 years of FinOp expertise, ACI’s team of CPAs and licensed securities professionals delivers turnkey accounting and reporting solutions that enhance accuracy, reduce costs and minimize regulatory exposure. Through our trusted relationships with FINRA and other Designated Examining Authorities (DEAs), ACI provides reliable financial stewardship to broker-dealers in an ever-evolving environment.
If you’d like to discuss SIPC’s new guidance, or how we can strengthen your firm’s financial operations, we’re happy to chat. Get in touch with our team to learn how our proactive advocacy, regulatory insight and FinOp expertise can help your team operate more confidently in today’s financial ecosystem.
Helpful SIPC links for further reading: