Form ADV Part 2 Brochure Delivery
Deliver 48 hours before the contract, or at signing with a 5-business-day exit.
What is Form ADV Part 2 Brochure Delivery?
Part 2A (the firm brochure) and Part 2B (supplements on the individuals advising the client) disclose services, fees, conflicts, disciplinary history, and methods. Under NASAA's brochure rule, a state-registered adviser delivers them at least 48 hours before entering an advisory contract, or at the time of signing if the client can terminate without penalty within 5 business days. Each year, within 120 days of fiscal year-end, clients receive an updated brochure or a summary of material changes.
Form ADV Part 2 Brochure Delivery: a worked example
An adviser handing over the brochure at the signing meeting must let the client cancel penalty-free for five business days.
More terms in Ethics & Fiduciary Obligations
Advisory Contract Requirements
Written, specific about fees, no assignment without consent, no waiver of rights.
Assignment of an Advisory Contract
Transferring a client contract requires the client's consent - including by change of control.
Performance-Based Fees & Qualified Clients
Allowed only for qualified clients: $1.4M with the adviser or $2.7M net worth (from June 29, 2026).
Prepaid Fees & Financial Requirements
Prepayment over $500, six months ahead, triggers net worth and balance sheet rules.
Custody
Holding, or having authority to obtain, client funds or securities.
Discretionary Authority
Deciding the asset, the amount, or buy versus sell - without asking first.
Third-Party Trading Authorization
Anyone other than the owner needs written authority to trade the account.
Principal Transactions by Advisers
Selling to or buying from a client for the adviser's own account needs consent each time.