Every broker-dealer firm needs to have a FINOP or financial and operational principle for smooth financial regulatory compliance to save the business from miss happenings.
Firms operating today can’t only rely on focus reports and financial statements as they have to compete with a tough regulatory environment that demands something more than this. Hence taking FINOP service on board is as important as the vertebral bone for human beings.
Things should be kept in mind before hiring FINOP Service?
The things that are a must to make sure before hiring a FinOP professional are
- Education
- Series 27 license
- Professionalism
Why Is It Important for A FINOP Professional to be Licensed?
Everything has certain rules for its doing for better outcomes and hiring a FinOP is no exception. It is because he has to deal with major operations of your firm.
And his little mistake can put you in big trouble. Therefore, always go with series 27 licensed FINOP officers.
What Is a Series 27?
Mostly BD firm owners get confused about the series 27 license but that’s not a tricky thing. It’s a kind of permission from the state that the person is eligible for the respective post.
A series 27 exam is taken for the person wishing to operate as a FINOP professional and a license is issued to him for performing the duty after clearance of the exam.
A series 27 licensed FINOP is a guarantee that you have the right person having complete knowledge of broker-dealer accounting and can easily abide by the financial responsibilities of the firm.
Perks of Hiring a FINOP Service:
A FINOP professional offers your broker-dealer firm the following perks.
FINOP Professional Keep the Records
Record maintenance is essential for ensuring the perfect running of a firm. Like if any problem happens, you can check thoroughly at the back end to resolve it immediately if you are having all the records aligned.
A FINOP helps you in record-keeping by tracking all the work of the firm back to back. He keeps a proper check and balance on all the operations according to the rules initiated by SEC. For example, dealing with revenues, payoffs, wire processing, etc., etc.
Provides Assistance in Report Making for Minimizing Gaps in Working
A proper report is a requirement of every firm for making sure that all the things are going in the right order or not. A FINOP professional helps you in dealing with this important procedure.
He keenly studies all the records of working and prepares the report so that it can be checked that where the gaps are existing and which areas are needed to be focused on more.
Careful Handling of the Documents
Every broker-dealer firm is based on multiple departments and the proper documentation of all those is necessary.
But, this is not so easy as it may sound to you, therefore a FINOP service is a perfect option. An experienced FINOP deals with the documentation perfectly as it’s what he is hired for.
The major documentation that he takes care of includes General Ledger, Balance Sheet, Income Statement, Flash Statement, Reconciled Bank Statement Accounts Payable Reports.
Dealing with Bank Reconciliations
For the money-related explanation of a broker-dealer firm, bank compromises are vital. A FINOP professional deal with the reconciliations of all bank accounts for the clients on a month-to-month premise.
It’s because a regulatory authority FINRA has made it compulsory to do the reconciliations for sold internal control over each cash action within the firm. However, it is important to note that bank reconciliation is different from record keeping.
The reason is; by going this way it becomes easy to reduce the risks of fraud, misdealing of the firm’s assets, or any other illegal action related to finance.
What Kind of FINOP Services Are Good Full-time or Outsourced?
A FINOP professional has so many responsibilities on his shoulders and for this reason, the costs of his services are a little higher. If you are going with a full-time FINOP service, the cost rises a little more even.
On the other hand, if you are going to outsource one it would be rather economical. However, you must keep certain things in mind while outsourcing a FINOP including
1- Qualification
2- Previous working record
3- Ethical values, as he has to talk with authorities on your behalf
4- The nature of services i.e. whether they satisfied your requirement or not.
5- Your Budget
