CEFEX Investment Advisor Independent Assessment Report

Independent Assessment Report

Intelligent Capitalworks

CEFEX Investment Advisor Certification

Investment Advisor Definition

A fiduciary who is responsible for managing a client’s overall investment strategy, which may include deciding on the client’s asset allocation, developing the client’s investment strategy, implementing the strategy with appropriate Investment Managers, and monitoring the strategy, on a one-time or ongoing basis. The term refers to those who provide specific or comprehensive investment advice including financial advisors, broker-consultants, investment consultants, wealth managers, financial consultants trust officers, financial planners and fiduciary advisers.

SECTION 1 – COMPANY INFORMATION
CEFEX File No.:	CFX10617
Company Name:	Intelligent Capitalworks
Address:	16427 N. Scottsdale Rd., Suite 350 Scottsdale AZ 85254 US
Phone:	480-951-2900

SECTION 2 – ASSESSMENT DETAILS
Date of Registration:	2022.11.23
Assessment Number:	R3
Assessment Team:

Position	Name	Company
Analyst	Roger Levy	Cambridge Fiduciary Services LLC.
Client	Vincent Rossi	Intelligent Capitalworks
Client	Charles Rossi	Intelligent Capitalworks
Client	Jillian Carlson	Intelligent Capitalworks

CEFEX Registration Committee (CRC)

The CEFEX Registration Committee is responsible for ensuring the consistency, impartiality and technical merit of CEFEX assessments. Members of the CRC include: Blaine F. Aikin, CFP®, CFA, AIFA® founder and principal Fiduciary Insights, J. Richard Lynch, AIFA®, consultant, instructor and subject matter expert for Fi360, David A. Vriesenga, Senior Partner Vriesport Consulting Services, Roger Levy, AIFA®, Managing Director Cambridge Fiduciary Services LLC, Matthew Boyle, AIFA® Director of Operations, CEFEX and Carlos Panksep, Vice President, CEFEX.

Attestation

The Analyst is independent of the registered firm. He/she has not been employed or compensated by the registered firm for a period of at least 2 years prior and 6 months following this assessment, for the purposes of providing fiduciary consulting services. The Analyst is an Accredited Investment Fiduciary Analyst (AIFA®) and has the adequate expertise and proficiency to perform this assessment.

Purpose and Scope of this Assessment:

To evaluate the Advisor’s conformance to the practices and associated criteria as defined in the document “Prudent Practices for Investment Advisors” (the Standard) for the declared scope of registration. A full copy of the Standard which is the basis for this assessment, can be found in the Prudent Practices Handbook here.

The scope of registration is as follows:

Fiduciary fee-only wealth advisory, retirement planning and investment management services for high-net worth individuals, families, and trusts.

Summary of Assessment Methodology:

The assessment requires that the Analyst plan and perform a review of a representative sample of the Advisor’s written records, interviews with appropriate personnel and, on a test basis, collect evidence supporting the actions taken by the Advisor in providing services to its clients. Sampling of records was conducted in accordance with the statistical guidelines used by the International Organization for Standardization, which requires a maximum sample size equal to the square root of the total available records.

Assessment elements include:

Background check (performed at initial assessment), including ADV, FINRA BrokerCheck (if applicable) and civil lawsuit databases.
Document review including Investment Policy Statement, Investment Committee minutes, client performance reports, RFP’s in the selection of service providers, written evidence of Investment Manager reviews, and service agreements.
Comparison of capital market inputs for asset allocation model assumptions to a benchmark
Comparison of risk and return models to a benchmark
Comparison of investment due diligence screens to a standard threshold
Review of actual investments using a standard fiduciary scoring system. The Fiduciary Score is a measure of an investment’s position relative to a group of peers, using factors such as track record, assets, management tenure, style consistency, etc. over a period of three years.
Review of arrangements with custodians, brokers and other service providers.

SECTION 3 - ASSESSMENT FINDINGS

The following Practices were assessed within the 3 months prior to the Date of Registration shown above and found to be in conformity.

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No.	Practice	Status
1.1	The Advisor demonstrates an awareness of fiduciary duties and responsibilities. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 1.1.1 The Investment Advisor complies with all laws and rules that apply to the services the Advisor is providing. 1.1.2 The Investment Advisor complies with all applicable Practices and Procedures defined in this Prudent Practices handbook. 1.1.3 The Investment Advisor adheres to all applicable standards of conduct and code(s) of ethics required by law, regulation, employers, and professional organizations.
	Substantiation Employee Retirement IncomeSecurity Act of 1974 [ERISA] §404(a) (1) *Regulations* 29 C.F.R. §2550.404a-1 *Case Law* Tibble v. Edison, Int’l, 135 S. Ct. 1823, 59 E.B.C.2461 (2015), on remand 843 F. 3d 1187 (9th Cir. 2016) and 2017 WL 3523737(C.D.Cal. 2017); Tussey v. ABB, Inc., 52 E.B.C. 2826, 2012 WL 1113291(W.D. Mo. 2012), aff’d in part 2014 WL 1044831 (8th Cir. 2014) and 2017 WL 929202 (8th Cir. 2017), Braden v. Wal-Mart Stores, Inc., 588 F. 3d 585(8th Cir. 2009), 6:08-cv-03109-GAF (W.D. Mo. 2012); Marshall v. Glass/Metal Association and Glaziers and Glassworkers Pension Plan, 507 F. Supp. 378 2 E.B.C. 1006 (D.Hawaii 1980); Katsaros v. Cody, 744 F. 2d 270, 5 E.B.C. 1777 (2d Cir. 1984), cert. denied, Cody v. Donovan, 469 U.S. 1072, 105 S. Ct. 565, 83 L. Ed. 2d 506 (1984); Marshall v. Snyder, 1 E.B.C. 1878 (E.D.N.Y. 1979); Donovan v. Mazzola, 716 F. 2d 1226, 4 E.B.C. 1865 (9th Cir. 1983), cert. denied, 464 U.S. 1040, 104S. Ct. 704, L.Ed.2d 169 (1984); Fink v. National Savings and Trust Company, 772F. 2d 951, 6 E.B.C. 2269 (D.C. Cir. 1985); Metzler v.Graham, 112 F. 3d 207 (5^th Cir. 1997) *Other* Joint Committee on Taxation, Overview of the Enforcement and Administration of the Employee Retirement and Income Security Act of 1974 (JCX1690, June 6, 1990) Staff of the U.S. Securities and Exchange Commission, Study on Investment Advisers and Broker Dealers, As Required by Section 913 of the Dodd-Frank Act (Jan.,2011) Investment Advisers Act of 1940 [IAA] §202(a)(11) [Definition of an‘Investment Adviser’] §206(1), (2), (3) [Anti-fraud provisions that apply to adviser’s fiduciary obligations] §203A(b)(1) [State authority over ‘small’ RIAs] *Regulations* Investment Advisers Act Rule 203-1 [Application for Investment Adviser Registration] Investment Advisers Act Rule 204-2 [Books and Records to be Maintained by Investment Advisers] Investment Advisers Act Rule 204A-1 [Investment Advisers Codes of Ethics] Investment Advisers Act Rule 206(4)-1 [Advertisements by Investment Advisers] *Case Law* Scott E. DeSano, et al., SEC Adm Proc 3-12879A (Mar. 6, 2008); Strong Capital Management, Inc., et al., Investment Company Act Release No. 26448 (May 20, 2004); SEC v. Capital Gains Research Bureau, 375 U.S. 180 (1963); Transamerica Mortgage Advisors, Inc. v. Lewis, 444 U.S. 11, 17 (1979); In re Arleen W. Hughes, Release No. 34-4048 (Feb 18, 1948) *Other* Information for Newly-Registered Investment Advisers, Prepared by the Staff of the Securities and Exchange Commission’s Division of Investment Management and Office of Compliance Inspections and Examinations, http://sec.gov/divisions/investment/advoverview.htm (July 2011) Unethical Business Practices Of Investment Advisers, Investment Adviser Representatives, And Federal Covered Advisers, NASAA Model Rule 102(a)(4)-1 (Adopted Apr. 27, 1997, Amended Apr. 18, 2004 and Sept. 11, 2005) Code of Ethics Guidance for Investment Advisers (June 26, 2015)(im-guidance-2015-03.pdf). State Insurance Regulation Suitability and Best Interests in Life Insurance and Annuity Transactions, New York Dep’t. of Fin. Svcs. (11 NYCRR 224). (Adopted July 17, 2018; effective Aug. 1, 2019.) Applicability of the Investment Advisers Act to Financial Planners, Pension Consultants, and Other Persons Who Provide Investment Advisory Services as a Component of Other Financial Services, SEC Interpretive Release No. IA-1092, http://www.sec.gov/rules/interp/1987/ia-1092.pdf (Oct. 8, 1987) Uniform Prudent Investor Act [UPIA] §1(a); §2(a); §2(d) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b); §3(c) Model Management of Public Employee Retirement Systems Act [MMPERSA] §7 *Case Law* Harvard College v. Amory, 26 Mass. 446, 9 Pick. 454 (1830); Davoue v.Fanning, 2 Johns. Ch. 252 (N.Y. 1816); Fulton v. Whitney, 66 N.Y.548 (1876); and National Labor Relations Board v. Amax Coal Co., 453 U.S. 322, 101 S. Ct. 2789, 69 L.Ed. 2d 672 (1981)
1.2	Investments and investment services provided are consistent with applicable governing documents. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 1.2.1 Investments are managed and investment services are provided in accordance with governing documents, including documents establishing the terms of an account or client engagement and the investment policy statement. 1.2.2 Documents pertaining to the investment management process, including records of decisions made by fiduciaries and clients, are secure and readily and reliably accessible by authorized persons.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §3(38)(C); §104(b)(4); §402(a)(1); §402(b)(1); §402(b)(2); §403(a); §404(a)(1)(D); §404(b)(2) *Regulations* Interpretive Bulletin 2016-1 (reinstating the language of Interpretive Bulletin 94-2, with certain modifications), 81 Fed. Reg. 95879 (Dec. 29, 2016) *Case Law* Morse v. New York State Teamsters Conference Pension and Retirement Fund, 580 F. Supp. 180 (W.D.N.Y. 1983), aff’d, 761 F.2d 115 (2d Cir. 1985); Winpisinger v. Aurora Corp. of Illinois, 456 F. Supp. 559 (N.D. Ohio 1978); Liss v. Smith, 991 F. Supp. 278, 1998 (S.D.N.Y. 1998); Dardaganis v. Grace Capital, Inc., 664 F. Supp. 105 (S.D.N.Y. 1987) aff’d, 889 F.2d 1237 (2d Cir. 1989) ); White v. Martin, 286 F. Supp. 2d 1029, 1039-41 (D. Minn. 2003); Kirshbaum v. Reliant Energy, Inc., 526 F.3d 243 (5^th Cir. 2008) Investment Advisers Act of 1940 [IAA] §204(a) *Regulations* SEC Advisers Act Rule 204-2 [Books and records to be maintained by investment advisers.] *Case law* In the Matter of Covenant Financial Services, LLC and Stephen Shafer, Investment Advisers Act Release No. 4672 (Mar. 29, 2017); In the Matter of Calvert Investment Distributors, Inc. and Calvert Investment Management, Inc., Investment Advisers Act Release No. 4696 (May 2, 2017); In the Matter of Aisling Capital LLC, Investment Advisers Act Release No. 4951 (June 29, 2018) *Other* Form ADV and Investment Advisers Act Rules, Investment Advisers Act Release No. 4509 (August 25, 2016); Recordkeeping Requirements For Investment Advisers, NASAA Model Rule 203(a)-2, (Adopted Sept. 3, 1987, amended May 3, 1999, Apr. 18, 2004, and Sept. 11, 2005). Uniform Prudent Investor Act [UPIA] §1(b); §2(a)–(d); §4 Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(a); §3(b); §3(c); §3(e); §5(a) Model Management of Public Employee Retirement Systems Act [MMPERSA] §4(a)–(d); §7(6); §8(b)
1.3	The roles and responsibilities of all involved parties whether fiduciaries or non-fiduciaries are defined and documented. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 1.3.1 All involved parties have acknowledged their roles and responsibilities and fiduciary or non-fiduciary status in writing.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §3(38)(c); §402(a)(1);§402(b)(2) and (3); §403(a)(2); §404(a)(1)(B); §404(c); §405(c) *Regulation* 29C.F.R. 2550.408b-2(c)(1)(iv)(B). *Case Law* Marshall v. Glass/Metal Association and Glaziers and Glassworkers Pension Plan, 507 F. Supp. 378 2 E.B.C. 1006 (D.Hawaii 1980); Katsaros v. Cody, 744 F.2d 270, 5 E.B.C. 1777 (2d Cir. 1984), cert. denied, Cody v. Donovan, 469 U.S. 1072, 105 S. Ct. 565, 83 L. Ed. 2d 506 (1984); Marshall v. Snyder, 1 E.B.C. 1878 (E.D.N.Y. 1979); Donovan v. Mazzola, 716F.2d 1226, 4 E.B.C. 1865 (9th Cir. 1983), cert. denied, 464 U.S. 1040,104 S. Ct. 704, L. Ed. 2d 169 (1984); Fink v. National Savings and Trust Company, 772 F. 2d 951, 6 E.B.C. 2269 (D.C. Cir. 1985); Ellis v. Rycenga Homes, 484 F. Supp. 2d 694 (W.D. Mich. 2007); Jenkins v. Yager, 444 F.3d 916 (7^th Cir. 2006). *Other* Joint Committee on Taxation, Overview of the Enforcement and Administration of the Employee Retirement and Income Security Act of 1974 (JCX1690, June 6,1990) Investment Advisers Act of 1940 §205(a)(2) Cite for Compliance Programs of Investment Companies and Investment Advisers, Advisers Act Release No. 2204 (Dec. 17,2003) [68 FR 74714 (Dec. 24, 2003)] *Other* Adviser Business Continuity and Transition Plans (proposed rule), Investment Advisers Act Release No. 4439, https://www.sec.gov/rules/proposed/2016/ia-4439.pdf (June 28, 2016). Information for Newly-Registered Investment Advisers, Prepared by the Staff of the U.S. Securities and Exchange Commission’s Division of Investment Management and Office of Compliance Inspections and Examinations, http://sec.gov/divisions/investment/advoverview.htm (Oct. 8, 1987) Uniform Prudent Investor Act [UPIA] §1(a); §2(a); §2(d); §9(a)(1)and (2) *Other* Restatement of Trusts 3d: Prudent Investor Rule §171 (1992) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b); §3(c) Model Management of Public Employee Retirement Systems Act [MMPERSA] §6(a) and (b); §7; §8(b) *Case Law* National Labor Relations Board v. Amax Coal Co.,453 U.S. 322, 101 S. Ct. 2789, 69 L. Ed. 2d 672 (1981) Sacerdote v. N.Y. Univ., S.D.N.Y., No. 1:16-cv-06284-KBF (2018)
1.4	The Investment Advisor identifies material conflicts of interest and avoids or manages conflicts in a manner consistent with the duty of loyalty. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 1.4.1 Policies and procedures for overseeing and managing conflicts of interest, including to avoid self-dealing and making false or misleading statements, are defined and followed. 1.4.2 Conflicts of interest are avoided when prohibited by law and/or governing documents. 1.4.3 Conflicts of interest that are not avoided must be managed in the client’s best interest. 1.4.4 Conflicts of interest that are not avoided must be disclosed to the client and informed client consent must be obtained.
	Substantiation Internal Revenue Code of 1986, as amended [IRC] §4975(c) Employee Retirement Income Security Act of 1974 [ERISA] §3(14)(A) and (B);§404(a)(1)(A); §405(a); §406(a) and (b); and §408 *Regulation* 29 C.F.R. §2550.408(b)-2(b), (c), and (e) *Case Law* Whitfield v. Tomasso, 682 F. Supp. 1287, 9E.B.C. 2438 (E.D.N.Y 1988); Tibble v. Edison Int’l,135 S. Ct. 1823, 59 E.B.C. 2461(2015), on remand 843 F.3d 1187 (9th Cir. 2016) and 2017 WL 3523737(C.D.Cal. 2017); People v. Martz, 28 Misc. 3d 1215A, No. 0025/09,2010 WL 2977151 (N.Y. Sup. July 29, 2010) *Other* DOL Advisory Council on Employee Welfare and Benefit Plans Report of the Working Group on Fiduciary Responsibilities and Revenue Sharing Practices, Nov. 7, 2007 DOL Advisory Council on Employee Welfare and Benefit Plans Report of the Working Group on Soft Dollars and Commission Recapture Nov. 13, 1997 DOL Prohibited Transaction Exemption 77-4, 42 Fed. Reg. 18732 (Apr. 8, 1977) Investment Advisers Act of 1940 [IAA] §205(a); §206(1) and (2) *Regulation* 17 C.F.R. §275.204-3; 17 C.F.R. §275.204A-1; 17 C.F.R. §275.206(3)-3t; 17 C.F.R. §275.206(4)-6; 17 C.F.R.§275.206(4)-7 *Case Law* In the Matter of Blackstone Management Partners L.L.C., Blackstone Management Partners III L.L.C., and Blackstone Management Partners IV L.L.C., Investment Advisers Act Release No. 4219 (Oct. 7, 2015); In the Matter of Centre Partners Management, Investment Advisers Act Release No. 4604 (Jan.10, 2017); In the Matter of Credit Suisse Securities (USA) LLC, Investment Advisers Act Release No. 4678 (Apr. 4,2017); In the Matter of Institutional Investors Advisory Company, Investment Advisers Act Release No. 4747 (Aug.16, 2017); In the Matter of Envoy Advisory, Inc., SEC Investment Advisers Act Release No. 4764 (Sept. 8, 2017); In the Matter of Suntrust Investment Services, Inc., SEC Investment Advisers Act Release No. 4769 (Sept. 14,2017); In the Matter of Financial Fiduciaries, LLC and Thomas Batterman, Investment Advisers Act Release No.4863 (Mar. 5, 2018); In the Matter of Securities America Advisors, Investment Advisers Act Release No. 4876 (Apr.6, 2018); In the Matter of WCAS Management Corporation, Investment Advisers Act Release No. 4896 (Apr. 24,2018); In the Matter of Lyxor Asset Management, Inc., Investment Advisers Act Release No. 4932 (June 4, 2018); In the Matter of Michael Devlin,Investment Advisers Act Release No. 4973 (July 19, 2018) *Other* Heitman Capital Management et al., SEC No-Action Letter(Feb. 12, 2007); NASAA Unethical Business Practices of Investment Advisers, Investment Adviser Representatives, and Federal Covered Advisers, Model Rule 201(a)(4)-1 (Adopted April 27, 1997,Amended April 18, 2004 and Sept. 11, 2005), http://www.nasaa.org/wp-content/uploads/2011/07/6-IAUnethical091105.pdf; SEC Share Class Selection Disclosure Initiative (announced on Feb. 12, 2018), https://www.sec.gov/enforce/announcement/scsd-initiative. Uniform Prudent Investor Act [UPIA] §2; §5 Uniform Prudent Management of Institutional Funds Act [UPMIFA] Prefatory Note Model Management of Public Employee Retirement Systems Act [MMPERSA] §7(1) and (2); §17(c)(12) and(13)
1.5	Agreements under the supervision of the investment advisor are in writing and do not contain provisions that conflict with fiduciary obligations. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 1.5.1 The investment advisor fully discloses in writing all compensation arrangements and affiliations associated with the service agreement. 1.5.2 If the investment advisor is responsible for oversight of other service providers, the advisor must evaluate all material compensation, affiliations, and the fiduciary status of each service provider. 1.5.3 Agreements are periodically reviewed to ensure consistency with the needs of the client. 1.5.4 Comparative reviews of service agreements for which the Investment Advisor is responsible are conducted and documented approximately every three years.
	Substantiation Internal Revenue Code of 1986, as amended [IRC] §4975(d) Employee Retirement Income Security Act of 1974 [ERISA] §3(14)(B); §3(38)(C); §402(c)(2); §403(a)(2); §404(a)(1); §408(b)(2) *Case Law* Liss v. Smith, 991 F. Supp. 278 (S.D.N.Y. 1998); Whitfield v. Tomasso, 682 F.Supp. 1287, 9 E.B.C. 2438 (E.D.N.Y. 1988); Kraft Foods Global, Inc., 641 F.3d 786 (7th Cir. 2011) *Regulations* 29 C.F.R. §2550.408b-2; 29 C.F.R. § 2550.408b-2(c). Investment Advisers Act of 1940 §206(1) and (2) *Case Law* In the Matter of Central States Capital Markets, LLC, et. al, Investment Advisers Act Release No. 4352 (Mar. 16, 2016); In the Matter of Potomac Asset Management Co., Inc., et al., Investment Advisers Act Release No. 4766 (Sept. 11, 2017); In the Matter of Platinum Equity Advisors, LLC, Investment Advisers Act Release No. 4772 (Sept. 21, 2017); In the Matter of TPG Capital Advisors, LLC, Investment Advisers Act Release No. 4830 (Dec. 21, 2017); In the Matter of Aberon Capital Management, LLC & Joseph Krigsfield, Investment Advisers Act Release No. 4914 (May 24, 2018). Uniform Prudent Investor Act [UPIA] §2(a); §5; §7; §9(a)(2) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b); §3(c); §5(a) Model Management of Public Employee Retirement Systems Act [MMPERSA] §5(a)(2); §6(b)(2); §7
1.6	Sensitive personal identifying information and assets of clients are prudently protected from theft, embezzlement, and business disruption risks. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 1.6.1 The Investment Advisor has a reasonable basis to believe assets are within the jurisdiction of a viable judicial system. 1.6.2 Appropriate procedures are in place to secure and prudently protect the privacy of client or plan data. 1.6.3 Appropriate procedures are in place to assure that sensitive personal identifying information and assets of clients are prudently protected from physical, operational, virtual, and other material risks associated with business disruptions. 1.6.4 The investment advisor has a reasonable basis to believe assets are protected by appropriate insurance, bonding, internal controls, and security measures taken by fiduciaries and other service providers, including the investment advisor’s own firm. 1.6.5 The investment advisor has procedures in place to manage situations where the advisor reasonably believes that a client’s assets are at risk due to suspicious behavior by service providers, the client, or others with access to or influence over the client’s assets. 1.6.6 The investment advisor has documented a succession plan and a business continuity plan that is reviewed and tested periodically.
	Substantiation Internal Revenue Code of 1986, as amended [IRC] *Other* Revenue Procedures 97-22 and 98-25 Employee Retirement Income Security Act of 1974 [ERISA] §107; §404(b); §405; §412(a) *Regulations* 29 C.F.R. §2550.404b1 29 C.F.R. § 2520.104b-1 29 C.F.R. §2520.107-1 *Case Law* Varity Corporation v. Howe, 516 U.S. 489, 116 S. Ct. 1065, 134 L.Ed.2d 130 (1996) *Other* H.R. Report No. 931280 (93rd Congress, 2d Session, Aug. 12, 1974) ERISA Advisory Council on Employee Welfare and Pension Benefit Plans Report on Cybersecurity Considerations for Benefit Plans (November 2016). Investment Advisers Act of 1940 15U.S.C. 80b *Case Law* In the Matter of R.T. Jones Capital Equities Management, Inc., Investment Advisers Act Release No. 4204 (Sept. 22, 2015). *Regulations* RegulationS-P, 17 CFR Part 248 Subpart A; Regulation S-AM, 17 CFR Part 248, Subpart B;Regulation S-ID, 17 CFR Part 248, Subpart C *Other* SEC Cybersecurity Risk Alert (Aug. 2017) (https://www.sec.gov/files/observations-from-cybersecurity-examinations.pdf); SEC Cybersecurity RiskAlert (Sept. 2015) (https://www.sec.gov/files/ocie-2015-cybersecurity-examination-initiative.pdf) Investment Company Act §17(f) *Regulations* Investment Company Act Rule 17f-5 [Custody of investment company assets outside the United States]. Uniform Prudent Investor Act [UPIA] §2(a); §5; §9(d) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b); §5(d) Model Management of Public Employee Retirement Systems Act [MMPERSA] §2(21); §6(e); §7; §11(c) and Comments State Law State privacy laws will also often apply and sometimes are much stricter than the laws and regulations outlined above. Best Practices on Cybersecurity National Institute of Standards and Technology Cybersecurity Framework V1.1 (Apr. 2018) (https://www.nist.gov/cyberframework)
2.1	An investment time horizon has been identified for each investment objective of the client. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 2.1.1 Sources, timing, distribution, and uses of each client's cash flows are documented. 2.1.2 In the case of an individual investor, an appropriate asset/liability study has been factored into the time horizon.
	Substantiation Internal Revenue Code of 1986, as amended [IRC] *Other* IRS Notice 2014-66 Employee Retirement Income Security Act of 1974 [ERISA] §3(34); §401(b)(1);§404(a)(1); §404(a)(1)(C) *Regulations* 29 C.F.R. §2550.404a-1(b)(1)(A);29 C.F.R. §2550.404a-1(b)(2); 29 C.F.R. §2550.404c-5 (Preamble); 29 C.F.R.§2509.08-1; §2509.96-1. *Case Law* Metzler v. Graham, 112 F.3d 207, 20 E.B.C. 2857 (5th Cir. 1997) *Other* Interpretive Bulletin 961, 29C.F.R. §2509.961; H.R. Report No. 1280, 93d Congress, 2d Session (1974); ERISA Opinion Letter 2006-08A (Oct. 3, 2008); Preamble to 29 C.F.R. §§2509, 2510, and 2550, 81 Fed. Reg. 20945 (Apr. 8, 2016); but see Chamber of Commerce v. U.S. Dep’t of Labor, 885 F.3d 360 (5th Cir.2018) (vacating final regulations) ;DOL Information Letter to Mark Iwry (October 23, 2014); DOL Advisory Council on Employee Welfare and Pension Benefit Plans Report on Participant Plan Transfers and Account Consolidation for the Advancement of Lifetime Plan Participation (November 2016). Investment Advisers Act of 1940 §206 Case Law SEC v. Capital Gains Research Bureau, 375 U.S. 180 (1963); In re David A. King and King Capital Corp., Investment Advisers Act Release No. 1391 (Nov. 9, 1933); In re George Sein Lin, Investment Advisers Act Release No. 1174 (June 19, 1989). Other Suitability of Investment Advice Provided by Investment Advisers, Investment Advisers Act Release No. 1406 (Mar. 16,1994). The Value of Goals-Based Financial Planning by David Blanchett, CFP®, CFA. Journal of Financial Planning 28 (6): 42–50. Uniform Prudent Investor Act [UPIA] §2(a); §2(b); §2(c); §4; §6 Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3 Model Management of Public Employee Retirement Systems Act [MMPERSA] §7; §7(4) (Comments); §8;§10(b)
2.2	An appropriate risk level has been identified for the portfolio. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 2.2.1 The expected volatility of the portfolio is understood by the investment advisor and communicated to the client, and the quantitative and qualitative factors that were considered are documented. 2.2.2 “Large loss” scenarios have been identified and considered in establishing the portfolio’s risk level. 2.2.3 Expected disbursement obligations and contingency plans have been considered when establishing liquidity requirements for the portfolio and assessing the capacity to assume portfolio risk.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §402(b); §404(a)(1)(B);§404(a)(1)(C) *Regulations* 29 C.F.R. §2509.75-5, FR-20; 29 C.F.R. §2550.404a-1(b)(1)(A); 29 C.F.R.§2550.404a-1(b)(2); 29 C.F.R. 2550.404c-1 (Preamble) *Case Law* Laborers National Pension Fund v. Northern Trust Quantitative Advisors, Inc., 173 F.3d 313, 23 E.B.C. 1001 (5th Cir.), reh’g andreh’g en banc denied, 184 F.3d 820 (5th Cir.), cert. denied, 528 U.S. 967, 120 S. Ct. 406, 145 L. Ed. 2d 316 (1999); Metzler v. Graham,112 F.3d 207 (5th Cir. 1997); Chase v. Pevear, 383 Mass. 350, 419 N.E.2d 1358 (1981) *Other* DOL Advisory Council on Employee Welfare and Benefit Plans Report Hedge Funds and Private Equity Investments (November 2011) Investment Advisers Act of 1940 *Case Law* In re Westmark Financial Services Corp., Investment Advisers Act Release No. 1117 (May 16, 1988); In re George E. Brooks & Assocs., Inc.,Investment Advisers Act Release No. 1746 (Aug. 17, 1998) Other Suitability of Investment Advice Provided by Investment Advisers, Investment Advisers Act Release No. 1406 (Mar. 16, 1994). Uniform Prudent Investor Act [UPIA] §2(a), (b), and (c); §2 Comments *Case Law* In the Matter of the Judicial Settlement of the Final Account of E. Barker, 801 N.Y.S. 2d 778 (2005), citing Matter of Rothko, 43 N.Y.2d 305 320 (1977) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3 Model Management of Public Employee Retirement Systems Act [MMPERSA] §7; §8; §8 Comments
2.3	The distribution of projected portfolio returns is evaluated in the context of the client’s risk and return objectives. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 2.3.1 The projected portfolio return is consistent with the client’s tolerance and capacity to assume volatility risk and investment goals and objectives. 2.3.2 Projected return assumptions for each asset class are based on reasonable risk-premium assumptions.
	Substantiation Internal Revenue Code of 1986, as amended [IRC] *Other* IRS Notice 2014-66 Employee Retirement Income Security Act of 1974 [ERISA] §3(34); §404(a)(1);§404(c) *Regulations* 29 C.F.R. §2550.404a-1(b)(1)(A); 29 C.F.R. §2550.404a-1(b)(2); 29 C.F.R. §2550.404c-1; 29 C.F.R. §2550.404c-5 (Preamble) *Case Law* Federal Power Commission v. Hope Natural Gas Company, 320 U.S. 591, 64 S. Ct. 281, 88 L. Ed. 333 (1944); Communications Satellite Corporation v. Federal Communications Commission, 611 F.2d 883(D.C. Cir. 1977); Katsaros v.Cody, 744F. 2d 270, 279 (2d Cir. 1984) (citing Marshall v. Glass/Metal Association, 507 F. Supp. 378, 384 (D. Hawaii 1980));Leigh v. Engle, 858 F.2d 361 (7th Cir. 1988); Jones v. O’Higgins, 11 EBC 1660 (N.D.N.Y. 1989); GIW Industries, Inc. v. Trevor, Stewart, Burton, & Jacobsen, Inc., 895 F.2d729 (11th Cir. 1990); GIW Industries, Inc. v. Trevor, Stewart, Burton, & Jacobsen, Inc., 895 F.2d 729 (11th Cir. 1990); Tennessee Gas Pipeline Company v. Federal Energy Regulatory Commission, 926 F.2d 1206 (D.C. Cir.1991); Lanka v. O’Higgins, 810 F. Supp. 379 (N.D.N.Y. 1992); *Other* H.R.Rep. No. 1280, 93rd Cong., 2d Sess. 304 (1974), reprinted in 1974 U.S. Code Cong. & Admin. News 5038; Elton, Edwin J. and Gruber, Martin J., Modern Portfolio Theory and Investment Analysis (1995); DOL Interpretive Bulletin 96-1, Participant Investment Education. [29 C.F.R. §2509.96-1] Preamble to 29 C.F.R. §§2509, 2510, and 2550, 81 Fed. Reg. 20945 (Apr. 8, 2016); but see Chamber of Commerce v. U.S. Dep’t of Labor, 885 F.3d 360 (5th Cir. 2018) (vacating final regulations). DOL Information Letter to Mark Iwry (Oct. 23, 2014) Investment Advisers Act of 1940 *Case Law* Jones Memorial Trust v. Tsai Inv. Services, Inc., 367 F. Supp. 491 (S.D.N.Y 1973); In the Matter of Alfred C. Rizzo, IA Release No. 897 (Jan. 11, 1984). *Other* Study on Investment Advisers and Broker-Dealers: As Required by Section 913 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (SEC, Jan. 21, 2011). Guidance Update: Robo-Advisers (SEC’s Division of Investment Management, Feb. 2017). Investor Alert:Automated Investment Tools, (SEC and FINRA, May 8, 2015). Uniform Prudent Investor Act [UPIA] §2(a), (b), and (c); §2(c)comments; §3(b); §5 *Case Law* Donahue v. Donahue, 2010 WL 481226 (Cap. App. 4 Dist.) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b) and (e) Model Management of Public Employee Retirement Systems Act [MMPERSA] §7; §7(4) (Comments); §8(a)(1)and (3); §8(b)
2.4	Selected asset classes are consistent with the client’s time horizon and risk and return objectives. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 2.4.3 The methodology and tools used to establish appropriate portfolio diversification are prudent and consistently applied.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §404(a)(1)(B); § 404(a)(1)(C) *Regulations* 29 C.F.R. §2550.404a1; 29 C.F.R. §2550.404a1(b)(1)(A); 29 C.F.R. §2550.404a1(b)(2)(B)(iiii) *Case Law* Fifth Third Bank v. Dudenhoeffer, 134 S.Ct. 2459, 58 E.B.C. 1405 (2014); GIW Industries, Inc. v. Trevor, Stewart, Burton & Jacobsen, Inc., 895 F.2d 729 (11th Cir. 1990); Leigh v. Engle, 858 F.2d 361 (7th Cir. 1988); Liss v. Smith,991 F. Supp. 278, 301 (S.D.N.Y. 1998); Marshall v. Glass/Metal Ass'n and Glaziers and Glassworkers Pension Plan, 507 F.Supp. 378, 384 (D. Haw. 1980). *Other* Interpretive Bulletin 96-1(d)(3), 29 C.F.R. §2509.961(d)(3); Joint Committee on Taxation, Overview of the Enforcement and Administration of the Employee Retirement Income Security Act of 1974, at 12 (JCX-16-90, June 6, 1990) Investment Advisers Act of 1940 *Case Law* People v.Goldsmith,86 N.Y.S. 2d 12 (1948) Uniform Prudent Investor Act [UPIA] §1(a); §2(a) and (b); §3 Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3; §3(e)(4) comment Model Management of Public Employee Retirement Systems Act [MMPERSA] §8(a)(2); §8(a)(2) comment;§7(1-3); §8 (b)
2.5	Selected asset classes are consistent with implementation and monitoring constraints. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 2.5.1 The Investment Advisor has the time, resources, knowledge and skills to implement and monitor all selected asset classes. 2.5.2 The process and tools used to implement and monitor investments in the selected asset classes are appropriate. 2.5.3 Appropriate investment products are accessible within each selected asset class.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §404(a)(1) *Regulation* 29 C.F.R.§2550.404a-1(b); *Case Law* Fink v. National Savings and Trust Company, 772 F.2d 951, 957, 6 E.B.C. 2269 (DC Cir. 1985); Donovan v. Mazzola, 716 F.2d 1226, 4 E.B.C. 1865 (9th Cir. 1983); Morrissey v.Curran, 567 F.2d 546, 548-49 (2d Cir. 1977); Harley v. Minnesota Mining and Manufacturing Company, 42 F. Supp. 2d 898 (D. Minn. 1999); Howard v. Shay, 100 F.3d 1484, 1488 (9th Cir. 1996); United States v. Mason Tenders Dist. Council of Greater New York, 909 F. Supp. 882, 886 (S.D.N.Y.1995); Trapani v. Consolidated Edison Employees’ Mutual Aid Society, 693F. Supp. 1509, 1516 (S.D.N.Y. 1988); Katsaros v. Cody, 744 F.2d 270 (2dCir.), cert. denied, 469 U.S. 1072 (1984); Donovan v. Mazzola,716 F.2d 1226 (9th Cir. 1983), cert. denied, 464 U.S. 1040 (1984); Leigh v. Engle, 727F.2d 113, 125-6 (7^th Cir. 1984); Beck v. Pace International Union, 427 F.3d 668, 677 (9^th Cir. 2005); In the Matter of the Judicial Settlement of the Intermediate and Supplemental Account of the JPMorgan Chase Bank, as Trustee of the Trust under Eighth (B) of the Last Will and Testament of Blanche D. Hunter, Deceased, 910 N.Y.S. 2d 405(2010); Laborers Nat’l. Pension Fund v. Northern Trust Quantitative Advisors, Inc., 173 F.3d 313 (5^th Cir. 1999); Lanka v. O’Higgins, 810 F. Supp. 379(N.D.N.Y. 1992); Jones v. O’Higgins, 11 EBC 1660 (N.D.N.Y.1989); Katsaros v.Cody, 744 F. 2d 270, 279 (2d Cir. 1984) (citing Marshall v. Glass/Metal Association, 507 F. Supp. 378, 384 (D. Haw. 1980)). *Other* H.R.Report No. 1280, 93rd Congress, 2d Sess.304, reprinted in 1974 U.S. Code Cong.& Admin. News 5038 (1974); DOL Advisory Council on Employee Welfare and Benefit Plans Report on Outsourcing Employee Benefit Plan Services, November 2014. Investment Advisers Act of 1940 *Case Law* In the Matter of Kidder Peabody & Co., Inc., IA Release No. 232 (Oct. 16, 1968). *Other* Interpretive Release Concerning the Scope of Section 28(e) of the Securities Exchange Act of 1934 and Related Matters, ’34 Act Release No. 23170(Apr. 23, 1986). Uniform Prudent Investor Act [UPIA] §2; §2(a) comments; §2(f)comments; §4; §9(a)(1-3); *Other* Restatement of Trusts 3d: Prudent Investor Rule §227, comment Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b) and (e); §5(a)(1)-(3) Model Management of Public Employee Retirement Systems Act [MMPERSA] §6(a) and (b); §7(3); §7(3)comments; §8(a); §8(b); §10(2)
2.6	The investment policy statement contains sufficient detail to define, implement, and monitor the portfolio’s investment strategy. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 2.6.1 The investment policy statement identifies the bodies of law governing the portfolio. 2.6.2 The investment policy statement defines the duties and responsibilities of all parties involved. 2.6.3 The investment policy statement specifies risk, return, and time horizon parameters. 2.6.4 The investment policy statement defines diversification and rebalancing guidelines consistent with risk, return, and time horizon parameters. 2.6.5 The investment policy statement defines the due diligence criteria for selecting investment options. 2.6.6 The investment policy statement defines procedures for controlling and accounting for investment expenses. 2.6.7 The investment policy statement defines monitoring criteria.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §402(a)(1); §402(b)(2);§402(c)(3); §403(a)(2); §404(a); §405(c)(1); §406(a)(1)(C); §408(b)(2) *Regulations* 29 C.F.R. §2550.404a-1(b)(1); §2550.404a-1(b)(2); 29 C.F.R. §2550.408b-2 *Case Law* In re Unisys Savings Plan Litigation, 74 F.3d 420, 19 E.B.C. 2393 (3rd Cir.), cert. denied, 510 U.S. 810, 117 S.Ct. 56, 136 L. Ed. 2d 19 (1996); Morrissey v. Curran, 567 F.2d 546, 1 E.B.C. 1659 (2nd Cir. 1977); Harley v. Minnesota Mining and Manufacturing Company, 42 F. Supp. 2d 898 (D. Minn. 1999), aff’d, 284 F.3d 901 (8th Cir.2002); Whitfield v. Cohen, 682 F. Supp. 188, 9 E.B.C. 1739 (S.D.N.Y.1988); Liss v. Smith, 991 F. Supp. 278 (S.D.N.Y. 1988); Leigh v. Engle, 858 F.2d 361, 10 E.B.C. 1041 (7th Cir. 1988), cert. denied, 489 U.S. 1078, 109 S. Ct. 1528, 103 L. Ed. 2d 833 (1989); GIW Industries, Inc.v. Trevor, Stewart, Burton, & Jacobsen, Inc., 895 F.2d 729 (11th Cir.1990); Laborers Nat’l. Pension Fund v.Northern Trust Quantitative Advisors, Inc., 173 F.3d 313 (5^thCir. 1999); Lanka v. O’Higgins, 810 F. Supp. 379 (N.D.N.Y. 1992); Jones v.O’Higgins, 11 EBC 1660 (N.D.N.Y. 1989); Katsaros v. Cody, 744 F. 2d 270, 279 (2d Cir. 1984) *Other* Interpretive Bulletin 942, 29 C.F.R. §08-2; 29 C.F.R. § 2509-08(2); Interpretive Bulletin 758, 29 C.F.R. §2509.75-8; H.R. Report No. 1280, 93rd Cong. 2d Sess. 304,reprinted in 1974 U.S. Code Cong. & Admin. News 5038 (1974); Interpretive Bulletin 96-1, Participant Investment Education. 29 C.F.R. §2509.96-1;Elton, Edwin J. and Gruber, Martin J., Modern Portfolio Theory and Investment Analysis (1995) Investment Advisers Act of 1940 *Other* Suitability of Investment Advice Provided by Investment Advisers, Investment Advisers Act Release No. 1406 (Mar. 16, 1994). Uniform Prudent Investor Act [UPIA] §2 and Comments; §3 and Comments; §4; §7; §9(a)(1), (2) and (3) *Other* Restatement of Trusts 3d: Prudent Investor Rule §227(a) and §277; OCC Interpretive Letter No. 722 (March 12, 1996), citing the Restatement of Trusts 3d: Prudent Investor Rule §227, comment m (1992) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b); §3(c); §3(e); §5(a) Model Management of Public Employee Retirement Systems Act [MMPERSA] §6(a); §6(b)(2) and (3);§7(2), (3) and (5); §7(5) and Comments; §8 and Comments *Other* Restatement of Trusts 3d: Prudent Investor Rule§171 and §227, comment g
3.2	Statutory or regulatory investment safe harbors that are elected are implemented in compliance with the applicable provisions. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 3.2.1 Available safe harbors are evaluated to determine if any advance the best interests of the investors and/or beneficiaries. 3.2.2 When elected, safe harbor provisions are implemented in compliance with requirements.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §3(38); §402(c)(3);§404(a)(1)(B); §404(c); §405(c)(2); §405(d)(1); §408(b)(14); §408(g)(10)-(11) *Regulations* 29 C.F.R.§2510.3-2f; 29 C.F.R. §2550.404a-1; 29 C.F.R. §2550.404-2;29 C.F.R. §2550.404-3; 29 C.F.R. §2550.404-4; 29 C.F.R.§2550.404a-5; 29 C.F.R. §2550.404c-1; 29 C.F.R. §2550.404c-5; 29 C.F.R.§2550.408g-1 *Other* Interpretive Bulletin 75-8, 29 C.F.R. §2509.75-8 (FR13-15, FR17Q); Interpretive Bulletin 08-02, 29 C.F.R. §2509.08-2; DOL Miscellaneous Document, Apr. 13, 1998 – Study of 401(k) Plan Fees and Expenses; Preamble to Investment Duties Regulation, 44 Fed. Reg.37,255 (June 26, 1979); Interpretative Bulletin 96-1(e), 29 C.F.R. §2509.96-1(e); Department of Labor Field Assistance Bulletin 2007-1 (Feb. 2,2007); DOL Advisory Opinion Letter 97-15A (May 22, 1997); DOL Advisory Opinion Letter 97-16A (May 23, 1997); TIAA Information Letter, Dec. 22, 2016. *Case Law* Tittle v. Enron Corp., 284 F. Supp. 2d 511, 578 (S.D. Texas 2003) Investment Advisers Act of 1940 §203(e)(6); §206(3) (principal transactions) Securities Exchange Act of 1934 §28(e) *Regulations* 17 C.F.R. §275.202(a)(25); 17 C.F.R. §275.203(3)(6); 17 C.F.R. §275.206(4)-7; 17 C.F.R. §270.38a-1; *Case Law* Tittle v. Enron Corp., 284 F.Supp. 2d 511, 578(S.D. Texas 2003); In the Matter of Western Asset Management Co. and Legg Mason Fund Adviser, Inc., Investment Advisers Act Release IA-1980 (Sep. 28, 2001); In the Matter of Morgan Stanley Investment Management, Inc.,Investment Advisers Act Release No. 3315 (Nov. 16, 2011) *Other* Uniform Application for Investment Adviser Registration (Form ADV), Glossary, Item 42;Disclosure by Investment Advisers Regarding Soft Dollar Practices, Investment Advisers Act Release 1469 (Feb. 14, 1995); Commission Guidance Regarding Client Commission Practices Under Section 28(e) of the Securities Exchange Act of 1934, Investment Advisers Act Release No.54165 (July 18, 2006) Uniform Prudent Investor Act [UPIA] §9(a); §9(c) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §5(a); 5(c) Model Management of Public Employee Retirement Systems Act [MMPERSA] §6(a); §6(b); §6(d)
3.3	Decisions regarding investment strategies and types of investments are made in accordance with fiduciary obligations and are documented. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 3.3.1 A prudent due diligence process is used to select investment strategies, investment managers, and investments. 3.3.2 Decisions regarding the selection of investments consider both qualitative and quantitative criteria. 3.3.3 The due diligence process used to select investment strategies, investment managers, and investments is documented and consistently applied. 3.3.4 Regulated investments are preferred over unregulated investments when all other characteristics are comparable. 3.3.5 Investments that are covered by readily available data sources are preferred over similar investments for which limited coverage is available when all other characteristics are comparable. 3.3.6 A prudent due diligence process is used to make decisions regarding the use of proprietary versus non-proprietary products, and separately managed versus commingled accounts. 3.3.7 Decisions regarding rollover advice are made in accordance with fiduciary duties of loyalty and care.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §404(a)(1)(B); §404(a)(1)(C) *Regulations* 29 C.F.R. §2550.404c1(b)(3)(i)(C) *Case Law* Metzler v. Graham, 112 F.3d 207, 20 E.B.C.2857 (5th Cir. 1997); Marshall v. Glass/Metal Ass’n and Glaziers and Glassworkers Pension Plan, 507 F. Supp. 378 (D. Hawaii 1980); GIW Industries, Inc. v. Trevor, Stewart, Burton & Jacobsen, Inc., 10 E.B.C.2290 (S.D. Ga. 1989); aff’d, 895 F.2d 729 (11th Cir. 1990); Leigh v. Engle, 858 F.2d 361, 10 E.B.C. 1041 (7th Cir. 1988), cert. denied, 489 U.S. 1078, 109 S. Ct. 1528, 103 L. Ed. 2d 833 (1989) *Other* H.R.Report No. 1280, 93rd Congress, 2d Sess. (1974), reprinted in 1974 U.S. Code Cong. & Admin. News 5038 (1974); DOL Prohibited Transaction Exemption 77-4,42 Fed. Reg. 18732 (Apr. 8, 1977); DOL Advisory Opinion 1998-06A (July 30,1998); DOL Advisory Opinion 2003-09A (June 25, 2003); DOL Advisory Opinion 2005-23A (December 7, 2005); DOL Advisory Opinion 2006-06A (July 26,2006). Investment Advisers Act of 1940 *Other* Risk Alert: Investment Adviser Due Diligence Processes for Selecting Alternative Investments (https://www.sec.gov/about/offices/.../adviser-due-diligence-alternative-investments.pdf) Uniform Prudent Investor Act [UPIA] §2(a); §3; §3 Comments Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(e) Model Management of Public Employee Retirement Systems Act [MMPERSA] §7(3); §8(a)(1)
4.1	Periodic reviews compare investment performance against appropriate market and peer group benchmarks and overall portfolio objectives. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 4.1.1 Investment performance of the overall portfolio is compared against an appropriate benchmark and evaluated in the context of portfolio objectives. 4.1.2 The performance of each investment option is periodically compared against an appropriate market and peer group benchmark and any other performance-related due diligence criteria defined in the investment policy statement. 4.1.3 Underperforming investments are monitored and decisions to retain or replace investments are documented. 4.1.4 Rebalancing procedures are reasonable, documented, and consistently applied. 4.1.5 Investment performance is periodically reported to the client.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §3(38); §402(c)(3); §404(a);§405(c)(2)(A)(iii); §408(g) *Case Law* Tibble v. Edison, Int’l, 135 S. Ct. 1823, 59 E.B.C. 2461 (2015), on remand 843 F.3d 1187 (9th Cir. 2016) and 2017 WL 3523737 (C.D.Cal. 2017); Tussey v. ABB, Inc.,52 E.B.C. 2826, 2012 WL 1113291 (W.D. Mo. 2012), aff’d in part 2014 WL 1044831(8th Cir. 2014) and 2017 WL 929202 (8th Cir. 2017); Leigh v. Engle, 727 F.2d 113, 4 E.B.C. 2702 (7th Cir. 1984); Atwood v. Burlington Indus. Equity, Inc., 18 E.B.C. 2009 (M.D.N.C. 1994)) *Other* Interpretive Bulletin 75-8, 29 C.F.R. §2509.75-8 (FR17); Interpretive Bulletin 08-2, 29 C.F.R. §2509.08-2; Interpretive Bulletin 2016-01, 29 C.F.R. §2509.2016-01; and DOL Field Assistance Bulletin 2018-01 (Apr. 23, 2018); DOL Tips for Selecting and Monitoring Service Providers (2005). Investment Advisers Act of 1940 *Case Law* SEC v. Capital Gains Research Bureau, Inc., 375 U.S. 180 (1963) *Other* Study on Investment Advisers and Broker-Dealers (SEC Staff, Jan. 21, 2011); Compliance Alert (June, 2007) Uniform Prudent Investor Act [UPIA] §2(a);§2(c); §9(a) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b); §3(e); §5(a) Model Management of Public Employee Retirement Systems Act [MMPERSA] §6(a); §6 (b)(1-3); §6(d); §6 Comments; §8(b)
4.2	Periodic reviews are made of qualitative and/or organizational changes of Investment Managers and other service providers. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 4.2.1 Periodic evaluations of the qualitative factors that may impact the results or reliability of Investment Managers are performed. 4.2.2 Negative news and other material information regarding an Investment Manager or other service provider are considered and acted on in a timely manner. 4.2.3 Deliberations and decisions regarding the retention or dismissal of Investment Managers and other service providers are documented.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §3(38); §402(c)(3);§404(a)(1)(B) *Regulations* 29 C.F.R. §2550.408b2(d); 29 C.F.R. §2550.408c2 *Other* Interpretive Bulletin 75-8, 29 C.F.R. §2509.75-8 (FR17); Booklet: A Look at 401(k) Plan Fees, U.S. Department of Labor, Pension and Welfare Benefits Administration Investment Advisers Act of 1940 *Regulations* 17 C.F.R. §275.206(4)-7 Case Law In the Matter of Horter Investment Management, LLC Investment Advisers Act Release No. 4823 (December 8, 2017) *Other* Compliance Programs of Investment Companies and Investment Advisers, SEC Rel. IA-2204(Dec. 18, 2003) Regulation of Investment Advisers, SEC Division of Investment Management (March 2013),Discussion of material disclosure, p. 23. Available at https://www.sec.gov/about/offices/oia/oia_investman/rplaze-042012.pdf. Uniform Prudent Investor Act [UPIA] §2(a); §7; §9(a) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b); §3(c); §5(a) Model Management of Public Employee Retirement Systems Act [MMPERSA] §6(a) and (b)(13); §7(5)
4.4	Periodic reviews are conducted to ensure that investment-related fees, compensation and expenses are fair and reasonable for the services provided. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 4.4.1 A summary of all parties being compensated from client portfolios or from plan or trust assets and the amount of compensation has been documented. 4.4.2 Fees, compensation, and expenses paid from client portfolios or from plan or trust assets are periodically reviewed to ensure consistency with all applicable laws, regulations, policies and procedures and service agreements. 4.4.3 Procedures are in place to avoid or identify and appropriately address unreasonable fees.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §3(14)(B); §404(a)(1)(A), (B)and (D); §406(a); §408(b)(2) *Regulations* 29 C.F.R. §2550.408(b)(2) *Case Law* Brock v. Robbins, 830 F.2d 640, 8 E.B.C. 2489 (7th Cir. 1987) *Other* Booklet:A Look at 401(k) Plan Fees, U.S. Department of Labor, Pension and Welfare Benefits Administration; DOL Advisory Opinion Letter 2001-01A (1/18/01); DOL Advisory Opinion Letter (7/28/98) 1998 WL 1638072; DOL Advisory Opinion Letter 89-28A (9/25/89) 1989 WL 435076; Interpretive Bulletin 75-8, 29 C.F.R.§2509.75-8 (FR17Q); California Assembly Bill No. 1743(Chapter 668, Statutes of 2010), codified in scattered sections of the California Government Code; 11 CRR-NY 136-2.4(d); DOL Advisory Opinion 97-15A (May 22, 1997); DOL Advisory Opinion 97-16A (May 22, 1997) Investment Advisers Act of 1940 §205(a)(1) Section 206(1) and Section 206(2) *Regulations* 17 C.F.R. §275.205-3; 17 C.F.R. § 275.206(4)-3 *Case Law* SEC v. Capital Gains Research Bureau, Inc., 375 U.S. 180 (1963) In the Matter of Barclays Capital Inc.,Investment Advisers Act Release No. 4705 (May 10,2017); In the Matter of Morgan Stanley Smith Barney, LLC, Investment Advisers Act Release No. 4607 (Jan.13, 2017); In the Matter of Capital Dynamics, Inc., Investment Advisers Act Release No. 4746 (Aug. 16, 2017); In the Matter of Beverly Hills Wealth Management, LLC and Margaret Mulligan Black, aka Margaret Mulligan Scott, Investment Advisers Act Release No. 4975 (July 20, 2018). *Other* Bisys Fund Servs., Inc., SEC No-Action Letter (Sept. 2, 1999); SEC Investment Adviser Examination Manual (1980); Compliance Programs of Investment Companies and Investment Advisers, SEC Rel. No. IA-2017 (Feb. 5, 2003); Don P. Matheson & Co.¸ SEC No-Action Letter (May 15, 1976) Risk Alert: Most Frequent Advisory Fee and Expense Compliance Issues Identified in Examinations ofInvestment Advisers (https://www.sec.gov/files/ocie-risk-alert-advisory-fee-expense-compliance.pdf) *State Securities Regulations* NASAA Unethical Business Practices Of Investment Advisers, Investment Adviser Representatives, And Federal Covered Advisers, Model Rule 102(a)(4)-1 Adopted 4/27/97, amended 4/18/04, 9/11/05 http://www.nasaa.org/content/Files/IAUnethical091105.pdf (August 2011) NASAA Investment Adviser Representative Definition, Model Rule USA 2002 102(16), (Adopted Sept. 17, 2008), http://www.nasaa.org/wp-content/uploads/2011/08/33-IA-Rules_General_USA2002.pdf Uniform Prudent Investor Act [UPIA] §2(a); §7 and Comments; §9, Comments *Case Law* Matter of Derek W. Bryant, 188 Misc. 2d 462, 729 NYS 2d309 (6/21/01) *Other* McKinneys EPTL11¬2.3(d) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(a)(, (b), and (c); §5(a) and (c)(1) Model Management of Public Employee Retirement Systems Act [MMPERSA] §6(b)(2) and (3); §7(2) and (5); §7, Comments
4.5	There is a process to periodically review the organization’s effectiveness in meeting its fiduciary responsibilities. Show Detail Hide Detail Show Substantiation Hide Substantiation	Conformity
	Detail 4.5.1 Fiduciary assessments are conducted at planned intervals to determine whether appropriate policies and procedures are in place to address all fiduciary obligations and that such policies and procedures are effectively implemented and maintained. 4.5.2 The investment policy statement is reviewed at least annually to ensure it is aligned with current facts and circumstances.
	Substantiation Employee Retirement Income Security Act of 1974 [ERISA] §404(a)(1)(B) *Case Law* Fink v. National Savings & Trust Co., 772 F.2d 951, 957 (D.C. Cir. 1985); Liss v. Smith, 991 F.Supp. 278, 299300 (S.D.N.Y.,1998); Harley v. Minnesota Mining and Manufacturing Company, 42 F.Supp. 2d 898, 906 (D. Minn. 1999) *Other* Department of Labor Employee Benefits Security Administration, “Meeting Your Fiduciary Responsibilities” (May 2004); 29 C.F.R. 2509.75-8; 29 C.F.R. 2509.08-2; 17 C.F.R. § 275.206(4)7; DOL Field Assistance Bulletin 2007-01. Investment Advisers Act of 1940 *Regulation* 17 C.F.R. §275.206(4)-7) *Case Law* In the Matter of Trust & Investment Advisors, Inc., Larry K. Pitts, and George M. Prugh, InvestmentAdvisers Act Release No. 4087 (May 18, 2015); In the Matter of Institutional Investor Advisers, Inc.Investment Advisers Act Release No. 4824 (Dec. 8, 2017). Uniform Prudent Investor Act [UPIA] §2(a); §2(d) Uniform Prudent Management of Institutional Funds Act [UPMIFA] §3(b) and (c) Model Management of Public Employee Retirement Systems Act [MMPERSA] §8(b); §7 The approach used to structure these Practices is modeled after that used by the International Organization for Standardization (ISO). Recently, the financial services community has begun to recognize the value of certification of conformity to standards. An ISO standard for financial planning (ISO 22222) exists and investment performance reporting practices can be certified to Global Investment Performance Standards (GIPS). In 2006, the Centre for Fiduciary Excellence (CEFEX) was formed to certify conformity with the practices covered in the Prudent Practices for Investment Fiduciaries handbook series. Fi360 is a founding member of CEFEX.

SECTION 4 - ASSESSMENT CONCLUSIONS AND RECOMMENDATION

Based on the findings obtained during the Assessment, the Company is in substantial conformity to the Standard, and is recommended for CEFEX registration.

This assessment has been reviewed by the CEFEX Registration Committee to maintain impartiality and consistency in the registration process. For details on the complete assessment process, please visit www.fi360.com/cefex.

Note to Report

The information contained in this report is a summary of an assessment conducted by CEFEX, Centre for Fiduciary Excellence and is valid for 1 year from the Date of Registration shown. The report is suitable for public distribution at the discretion of the certified firm. For any questions related to this report, please contact CEFEX at admin@cefex.org.

CEFEX, Centre for Fiduciary Excellence is an independent certification organization, and is part of Broadridge Fi360 Solutions. CEFEX works closely with industry experts to provide comprehensive assessment programs to improve the fiduciary practices of investment stewards, advisors, recordkeepers, administrators and managers.
Broadridge Fi360 Solutions is a fiduciary education, training and technology company, and helps financial intermediaries use prudent fiduciary practices to profitably gather, grow and protect investors’ assets. Since 1999, the firm has provided financial professionals with the tools necessary to act as a fiduciary in their work with investors. Broadridge Fi360 Solutions is also the home of the Accredited Investment Fiduciary® (AIF®) designation, the Fiduciary Focus Toolkit™ and the Fi360 Fiduciary Score®.

SECTION 1 – COMPANY INFORMATION

SECTION 2 – ASSESSMENT DETAILS

SECTION 3 - ASSESSMENT FINDINGS

SECTION 4 - ASSESSMENT CONCLUSIONS AND RECOMMENDATION