Annual Report Guidance for Commodity Pool Operators

In a recent release, which we have reprinted in full below, the CFTC reminds CPOs of their annual reporting requirements under Regulation 4.22.  The release includes a link to the 2010 CPO Annual Guidance Letter.  In general the letter provides another reminder to CPOs to file their annual reports with the NFA and provide a copy to the investors in the pool.  I have outlined below the major parts of the letter.

General Issues to consider

• Commodity pool annual reports must be distributed to pool participants within 90 calendar days of the pool’s fiscal year end.  For most funds this means by March 31, 2010.
• Commodity pool annual reports must be filed with the NFA within 90 clendar days of the pool’s fiscal year end.  For most funds this means by March 31, 2010.
• All documents must be filed electronically through the NFA’s filing system.
• Extensions are available in certain circumstances.

Other Issues

For groups which have different or more complex structures, additional considerations need to be addressed.  Such groups include:

• Master/feeder commodity pool structures
• Commodity pool fund of funds
• Offshore commodity pools
• CPOs claiming an exemption under Regulation 4.13
• Reports of commodity pools which are liquidating
• Commodity pools established as a series structure (such as a series LLC)
• Commodity pools which invest in non-exchange traded instruments may have additional issues

Moreover, the letter includes references to the recently amended CPO relations.

If a CPO will not be able to file on time, the CPO should file for an extension.  “Automatic” extensions can be granted to CPOs to fund of fund structures.  If you have questions with making a filing, please feel free to contact Cole-Frieman & Mallon LLP. The following press release can be found here.

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CFTC’s Division of Clearing and Intermediary Oversight Provides Annual Report Guidance to Commodity Pool Operators

Washington, DC — The Commodity Futures Trading Commission’s Division of Clearing and Intermediary Oversight has issued its annual guidance letter to registered commodity pool operators (CPOs). The letter is intended to assist CPOs and their public accountants in complying with the Commission’s regulations on the preparation and filing of commodity pool annual financial reports.

The highlights contained in this year’s letter include:

• Recent amendments to Commission regulations pertaining to various reporting issues;
• Annual report filing procedures and due dates;
• Special considerations that apply to filings made for Master/Feeder and Fund of Funds structures;
• Use of International Financial Reporting Standards in lieu of U.S. generally accepted accounting principles;
• Reporting requirements for pools in liquidation;
• Reporting requirements for series funds with limitation of liability among the different series; and
• Various accounting developments that may impact report preparation.

For more information on CPO Annual Guidance Letter 2009, please see the Related Documents link.

Copies of the letter also may be obtained by contacting the Commission’s Office of the Secretariat, Three Lafayette Centre, 1155 21st Street, N.W., Washington, D.C. 20581, (202) 418-5100.

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Other related compliance articles for CPOs and CTAs include:

• CTA & CPO Registration & Compliance Guide
• CTA and CPO Registration
• NFA Social Networking Compliance Information
• Forex Registration

Bart Mallon, Esq. runs the Hedge Fund Law Blog.  He can be reached directly at 415-868-5345.