{ "faqData": { "faq": [ { "id": "1", "question": "Can I serve on the board of an unrestricted non-profit organization?", "description": "Yes, you may serve on the board of an unrestricted non-profit that limits its activities to those of a charitable, educational, religious, civic, or similar nature. However, you should ensure the non-profit organization is not restricted by checking KICS - Entity Search. Further, you are not permitted to serve in roles responsible for the organization’s financial interests, loans, or selection of investment advisors, unless:

(i)  the organization agrees to apply the firm’s independence policies to its
     financial activities, or
(ii) you recuse yourself from discussions and decisions regarding the
     organization’s financial interests, loans, or selection of
     investment advisors.

If the non-profit organization applies the firm’s independence policies, you must record all of the organization’s investments in your KICS account." }, { "id": "2", "question": "My audit client approached me about an open position at their company. What should I do?", "description": "If you are interested in a position at a restricted entity, you should notify your Business Unit Professional Practice Partner - Audit or Risk Management - Independence immediately.

You cannot be on the audit engagement team during any negotiations regarding your possible employment with a restricted entity. If you are on the engagement team at the time negotiations begin, you will be removed.

Further, if you were a member of the audit engagement team and will join an SEC audit client at the issuer level in a financial reporting oversight role, you may not start in that position until the cooling-off period has passed." }, { "id": "3", "question": "Do independence policies apply if I hold a stock for less than a day (for example, day trading)?", "description": "Yes. Even if you open and close a position on the same day, the firm’s independence policies apply.

Members of the management group who participate in day trading activities are required to report all of their investment transactions manually in KICS because intra-day trading is not included in Broker Import feeds." }, { "id": "4", "question": "Are there additional concerns when investing in a private company?", "description": "If you invest in a private company, you must report the investment manually in KICS. In addition, you must closely monitor your investment and its restriction status because KICS does not provide an automated notification when private entities become restricted.

Caution: Investing in illiquid private companies and funds carry higher risks than investing in liquid stocks. If private investments become restricted entities, professionals may experience difficulty in or significant financial loss when disposing of their interests. Extreme diligence and caution should be exercised when investing in private companies and/or funds.

A company can become restricted due to:
OR


It is important to be mindful of these events." }, { "id": "5", "question": "How will I know if an unrestricted entity becomes restricted?", "description": "Public Entities
If you have an investment in an entity and it is reported in KICS, you will be notified by email if that entity becomes restricted.

In addition, typically each week, you will receive a “RESTRICTED ENTITY LIST UPDATE” email containing updates made to the Restricted Entity List (REL).

Private Entities
KICS does not provide automated notification when private entities become restricted. You must monitor private entities to ensure they have not become restricted." }, { "id": "6", "question": "What should I do if my spouse/spousal equivalent will not tell me about his/her financial affairs?", "description": "If your spouse/spousal equivalent or dependent will not give you the information you need, you will have to explain the consequences: that you will be disciplined for failing to comply with KPMG policies, and it may have an adverse effect on your career." }, { "id": "7", "question": "I am getting married and my spouse has a mortgage with a restricted entity. Do I need to dispose of the mortgage?", "description": "Maybe. As a Member of the Firm, existing loans that meet certain criteria are eligible to be grandfathered. However, the grandfathering policies are much more restrictive for Covered Persons.

If you are a Covered Person, and the mortgage is on the home that will be your primary residence, it will qualify for grandfathering, assuming the required conditions are met.

If you are a Covered Person, and the mortgage is on a home that will not be used as your primary residence, then the loan only qualifies for grandfathering if the lender is a non-SEC restricted entity. If the lender is an SEC restricted entity, refinancing of the loan is required prior to getting married." }, { "id": "8", "question": "What if my broker executes trades on my behalf?", "description": "It is your responsibility to ensure that all of your investments comply with the firm’s independence policies, even if someone other than you, such as a broker or a robo-advisor, makes a transaction on your behalf. For managed accounts, compliance with the independence policies can be difficult to ensure. Therefore, such accounts, aside from firm-supported programs, are discouraged.

You may provide your broker with access to KICS - Entity Search through a “mirror site” so that she/he can perform research prior to recommending investments for your purchase. Any research performed by your broker to determine whether an entity is restricted does not relieve you of the responsibility to check KICS - Entity Search before you authorize the trade. Independence compliance is your responsibility and it cannot be outsourced." }, { "id": "9", "question": "Can I purchase a cryptocurrency without impairing independence?", "description": "It depends. If the cryptocurrency is not owned or controlled by any entity, group, or individual, it is not considered an investment and may be purchased without impairing independence. Examples are bitcoin, litecoin, XRP (Ripple), and Ether.

If the virtual currency is owned or controlled by an entity, group, or individual, it may be treated as an investment, and you will need to consider the restriction status of the entity that controls or owns the currency, or issues the currency through an Initial Coin Offering (ICO), and whether you provide service to that entity or its affiliates. Further, if the cryptocurrency is held through an investment vehicle, such as a fund or trust, you will need to consider the restriction status of the investment vehicle.

Note that per RMA 18-003, you are required to consult with Risk Management - Independence, if you have or are considering purchasing a cryptocurrency other than those specifically identified above (i.e., bitcoin, litecoin, Ripple, or Ether)." } ] } }