From Policy to Practice: Implementing the SEC’s Private Fund Adviser Rules

The SEC’s new Private Fund Adviser rules are more than a compliance checkbox. They demand serious, tangible changes to how private fund managers operate, report, and govern. While headlines focus on fairness and transparency, the real challenge lies in translating regulatory intent into repeatable and auditable processes.

In this article, we explore how leading buy-side firms are preparing to implement these rules—not just in principle, but in day-to-day execution. From adviser-led secondaries to quarterly investor reporting, here’s what it takes to move from understanding the SEC’s new Private Fund Adviser rules to running your business in alignment with them.

Adviser-Led Secondaries: Embedding Fairness

What’s Required:
An independent valuation must be secured before executing a secondary transaction, with full disclosure of any material ties to the valuation provider.

Implementation Insights:

• Introduce formal review checkpoints in the secondaries deal process to ensure fair value assessments are independently vetted.
• Maintain a central disclosure log for documenting valuation provider relationships and potential conflicts.
• Assign cross-functional oversight—legal, compliance, and investment teams—to validate independence early in the transaction lifecycle.

Takeaway:
Treat adviser-led secondaries as regulated events, not commercial side tasks. Define the process, document it, and make it repeatable.

Annual Audits: Standardizing Oversight

What’s Required:
Registered advisers must conduct annual audits (and liquidation audits) for each private fund, excluding securitized asset funds.

Implementation Insights:

• Build a centralized audit calendar to track auditor appointments, timelines, and fund-specific deliverables.
• Use pre-audit preparation templates to gather expected financial data and investor records ahead of auditor requests.
• Automate data pulls from fund accounting systems to avoid last-minute reconciliations.

Takeaway:
Annual audits are no longer discretionary. Planning, documentation consistency, and tech-assisted coordination are now essential for effective project management.

 Quarterly Reporting: Making Fee and Performance Disclosures Scalable

 What’s Required:

Quarterly statements to investors must detail all fees, expenses, performance, and compensation.

Implementation Insights:

• Design standardized reporting templates that reflect the full set of required disclosures across all fund types.
• Set up integrated data feeds from accounting, portfolio, and CRM systems to eliminate the need for manual consolidation.
• Introduce internal sign-off protocols to ensure IR, compliance, and finance teams validate outputs before investor distribution.

Takeaway:

This isn’t just more reporting—it’s a new level of disclosure. Scale matters, and automation will make or break your ability to comply.

Compliance Reviews: Moving from Narrative to Evidence

What’s Required:

Enhanced documentation of annual compliance reviews focusing on effectiveness, not just policy existence.

Implementation Insights:

• Break down reviews by risk domain (e.g., valuation, conflicts, disclosures) and use consistent scoring or grading criteria.
• Link findings to supporting documentation (e.g., internal memos, control testing, exception logs).
• Track progress on any follow-up actions using issue management systems with clear ownership and deadlines.

Takeaway:

The SEC expects more than a compliance memo. Treat reviews like performance audits, ensuring they are measurable, documented, and outcome-driven.

Technology as a Force Multiplier

Firms that rely on spreadsheets and manual trackers will struggle to meet the demands of these rules at scale. A robust regulatory infrastructure should enable your firm to:

• Automate core disclosures and data collection
• Centralize documentation for faster audit prep
• Manage review cycles with clear accountability
• Adapt to future rule changes without rebuilding from scratch

The IVP Regulatory Reporting Solution is purpose-built for this environment, bringing automation, structure, and auditability to your compliance process.

Final Thoughts

The SEC’s new Private Fund Adviser rules are reshaping not just how buy-side firms report, but how they operate. The firms best positioned to comply with these new rules are those that take action early—standardizing processes, investing in the right systems, and treating compliance as an ongoing concern, not a one-off project.

Need help getting started?
Contact Indus Valley Partners to see how the IVP Regulatory Reporting Solution can help you meet the 2025 deadlines on time and on point.