2011 Kentucky Revised Statutes Subchapter 20 Financing of Development Generally 154.20.277 Annual audit of investment funds by certified public accountant -- Examination of investment funds by authority and Department of Revenue -- Other audits -- Department's powers of enforcement -- Notice of noncompliance -- Examination, investigative, and enforcement powers of securities regulatory organizations.
KY Rev Stat § 154.20.277 (1996 through Reg Sess) What's This?
154.20-277 Annual audit of investment funds by certified public accountant -Examination of investment funds by authority and Department of Revenue -Other audits -- Department's powers of enforcement -- Notice of
noncompliance -- Examination, investigative, and enforcement powers of
securities regulatory organizations.
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Each investment fund manager shall cause the books and records of the investment
fund to be audited on an annual basis by an independent certified public accountant
in accordance with generally accepted accounting principles consistently applied.
The audit shall address the financial condition of the investment fund and
compliance with the provisions of KRS 141.068 and KRS 154.20-250 to 154.20284. Each year the audit report shall be completed and certified by the independent
certified public accountant and delivered to the authority within ninety (90) days
after the end of the investment fund's fiscal year.
The authority and the Department of Revenue, individually or collectively, may
examine, under oath, any of the officers, trustees, partners, members, managers,
directors, agents, employees, or investors of an investment fund regarding the
affairs and business of the investment fund. The authority and the Department of
Revenue, individually or collectively, may issue subpoenas and subpoenas duces
tecum and administer oaths. Refusal to obey such a subpoena or subpoena duces
tecum may be reported to the Franklin Circuit Court, which shall enforce the
subpoena or subpoena duces tecum according to the rules of civil or criminal
procedure, as applicable.
In addition to the audits required by this section, the authority or the Department of
Revenue may audit one (1) or more investment funds or investment fund managers
in any year on a random basis or for cause. The authority or the Department of
Revenue may also audit, for cause, any small business in which an investment fund
has made a qualified investment. Nothing in this section shall be construed to
prohibit the Department of Revenue from conducting any audit relating to the
administration or enforcement of the tax laws of the Commonwealth which the
Department of Revenue determines to be appropriate.
If any audit conducted pursuant to this section discloses that an investment fund or
investment fund manager is not in compliance with the provisions of KRS 141.068
and KRS 154.20-250 to 154.20-284, the authority and the Department of Revenue
may consult with one another with respect to this noncompliance and the
Department of Revenue may exercise any of its powers to protect the
Commonwealth's interest and to enforce the provisions of KRS 141.068 and KRS
154.20-250 to 154.20-284.
The authority may give an investment fund manager written notice of any
noncompliance with the provisions of KRS 154.20-250 to 154.20-284 and specify a
period of time the investment fund manager shall have to cure any noncompliance.
Failure to cure any such noncompliance within the period of time specified by the
authority may result in further action by the authority pursuant to this section.
Nothing in this section shall be construed to prohibit the Department of Financial
Institutions, Division of Securities, or any other securities regulatory organization or
body with jurisdiction over the activity of an investment fund or the investment
fund manager from conducting any examination or investigation relating to the
securities activities of the investment fund or investment fund manager. If any
examination or investigation conducted pursuant to any securities laws or
regulations discloses that an investment fund or investment fund manager is not in
compliance with any provision of any applicable securities laws or regulations, the
appropriate securities regulator may take whatever action it deems appropriate in
accordance with such securities laws and regulations to respond to the
noncompliance, notwithstanding any action the authority or the Department of
Revenue may or may not take with respect to the noncompliance.
Effective: July 15, 2010
History: Amended 2010 Ky. Acts ch. 24, sec. 197, effective July 15, 2010. -- Amended
2005 Ky. Acts ch. 85, sec. 575, effective June 20, 2005. -- Amended 2002 Ky. Acts
ch. 230, sec. 25, effective July 15, 2002. -- Created 1998 Ky. Acts ch. 414, sec. 11,
effective July 15, 1998.
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