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Form ADV Part 1A Item 2A(2) · Answer type: yn · Item 2 - SEC Registration
Item 2A(2) asks whether the firm qualifies as a mid-sized advisory firm under specific AUM and state registration criteria.
This checkbox covers firms with regulatory assets under management of $25 million or more but less than $100 million that either: (a) are not required to register with their home-state securities authority, or (b) are not subject to examination by that state authority.
The mid-sized category creates a bridge between small state-only advisers and large SEC-registered firms. Without this rule, firms in the $25-$100 million range might face regulatory gaps or conflicting state requirements that complicate compliance.
The state registration conditions are crucial. A firm cannot simply choose SEC registration because its AUM falls in the mid-sized range. It must demonstrate that state registration is not required or that the state does not examine advisers, creating a regulatory need for SEC oversight.
Do not confuse 2A(2) with large adviser status in Item 2A(1) which applies above $100 million AUM. The mid-sized category specifically serves firms that have outgrown basic state oversight but have not reached large adviser thresholds.
Yes
The firm marks this box when it claims the mid-sized adviser path to SEC registration (generally the $25–$100 million regulatory AUM band under the Item 2A(2) rules) - a registration-basis claim, not a quality rating.
No
The firm reports No and does not claim this registration basis under 2A(2). Review the other Item 2 answers for the basis it does report.
2A(2) - Are a mid-sized advisory firm that has regulatory assets under management of $25 million (in U.S. dollars) or more but less than $100 million (in U.S. dollars) and you are either: (a) not required to be registered as an adviser with the state securities authority of the state where you maintain your principal office and place of business, or (b) not subject to examination by the state securities authority of the state where you maintain your principal office and place of business (Yes / No).
This appears in Item 2, SEC Registration, which explains the firm's basis for SEC registration eligibility.
Mid-sized adviser status reports a specific combination of RAUM and home-state registration or examination conditions. It does not rate the quality of state or federal oversight, operating sophistication, or compliance systems.
However, mid-sized status does not indicate superior quality compared to state-registered firms. Many excellent advisers operate below $25 million AUM and receive effective state oversight. Registration level reflects regulatory structure, not service quality.
The AUM range also does not guarantee specific service offerings or fee levels. Mid-sized firms vary widely in their business models, from specialized wealth management to institutional consulting.
Use 2A(2) to understand the firm's regulatory framework and approximate scale. Combine this with specific AUM figures in Item 5F and service descriptions in Item 5G for a complete picture.
Yes
The firm reports mid-sized advisory firm status under Item 2A(2). On Best Investors, confirm this against total regulatory AUM in Item 5F(2)(c) to verify the AUM falls between $25 million and $100 million.
Check the firm's principal office location in Item 1 to understand which state securities authority would otherwise have jurisdiction. This can provide context for why SEC registration was necessary.
Review client information in Item 5C and services in Item 5G to understand how the firm operates within the mid-sized category. Some focus on high-net-worth individuals while others serve institutional clients.
No
The firm does not claim mid-sized adviser status on this line. Check other Item 2A boxes for the actual registration basis. The firm might qualify as a large adviser above $100 million or use specialized categories like investment company adviser status.
If the firm has AUM in the mid-sized range but reports No, review the other Item 2 answers for the registration basis it claims. Do not infer its state-registration status from this No answer alone.