Page 36 - P&P11-05-2020-with-FAQ-JR

36

5. The investment advisor has no authority or ability to designate or change the identity of the third party,
the address, or any other information about the third party contained in the client’s instruction.
6 The investment advisor maintains records showing that the third party is not a related party of the
investment advisor or located at the same address as the investment advisor.
7 The client’s qualified custodian sends the client, in writing, an initial notice confirming the instruction and
an annual notice reconfirming the instruction.

The CCO will periodically review the arrangement to ensure it meets these conditions and document ABREEV’s
compliance with the conditions. In addition, CIS will update its Form ADV to disclose that it has custody of client
assets.

Trustee/Executor/Power of Attorney for Advisory Client
Certain clients of CIS may [appoint CIS or a related person of CIS as trustee/executor for the client/grant power of
attorney to CIS or to a related person of CIS]. When this occurs, CIS will be deemed to have custody of client
assets except that the SEC and some states do not consider an appointment as trustee or executor to result in
custody when the appointment is a result of a family or personal relationship with the client and not a result of
employment with the adviser.

In these cases, CIS will engage an independent account to perform an annual surprise audit of the client’s funds
and securities with the first audit to occur within six months after becoming trustee for the client.

The CCO will periodically review the arrangement to ensure it meets these conditions and document CISs
compliance with the conditions. In addition, CIS will update its Form ADV to disclose that is has custody of client
assets.

Qualified Custodian
Qualified custodian may include a bank or savings association that has deposits insured by the Federal Deposit
Insurance Corporation under the Federal Deposit Insurance and registered broker-dealers.

Receipt of Funds or Securities
If CIS receives a check made payable to a third party (such as a custodian), CIS will make a copy of the check,
record the receipt and delivery of the check, and will try to forward the check within 24 hours but always within
three (3) business days. An appropriate “check log” (see Sample 6) will be maintained to document receipt and
subsequent delivery of the check to the third party.

If CIS inadvertently receives client funds or securities (such as checks made payable to CIS for investment but not
for payment of advisory fees), CIS will return to the client the funds or securities within three (3) business days
with instructions for the client on where they should send or take the funds or securities.

Responsibility
John Riley has the responsibility for the implementation and monitoring of our policies, practices, disclosures,
recordkeeping and other requirements as an advisory firm which does maintain custody of client funds, securities
or assets.