,,ii  #aai? ,,congress  #b;d ,session   
,s4 #eded  ,,9 ,,! ,,s5ate ,,( ,,!      
,,unit$ ,,/ates  ,septemb] #bb1         
#bjbf,mr4 ,cotton introduc$ ! foll[+    
bill2 :i* 0 read twice & ref]r$ to !    
,committee on ,bank+1 ,h\s+1 & ,urban   
,affairs  ,a ,,bill  ,to am5d !         
,s>banes-,oxley ,act ( #bjjb to exclude 
! audits ( privately held1 non-c>ry+    
brok]s & deal]s t are 9 good /&+ f c]ta9
 requirem5ts "u title ,i ( t ,act1 & =  
o!r purposes4  #a4 ,%ort title ,?is ,act
 may be cit$ z ! ,small ,bus9ess ,audit 
,correction ,act ( #bjbf4  #b4          
,exemption  7a7 ,am5dm5ts to !          
,s>banes-,oxley ,act ( #bjjb ,section   
#aaj ( ! ,s>banes-,oxley ,act ( #bjjb   
7#ae ,u4,s4,c4 #gbbj7 is am5d$-- 7#a7 9 
p>agraph 7#c71 by ins]t+ 1 except t !   
t]m does n include a non-c>ry+ brok] or 
deal] t is privately held & 9 good /&+  
aft] regi/]$ public acc\nt+ firm2  7#b7 
9 p>agraph 7#d71 by ins]t+ 1 except t ! 
t]m does n include a non-c>ry+ brok] or 
deal] t is privately held & 9 good /&+  

aft] regi/]$ public acc\nt+ firm2  7#c7 
by r$esignat+ p>agraphs 7#e7 & 7#f7 z   
p>agraphs 7#h7 & 7#i71 respectively2 &  
7#d7 by ins]t+ aft] p>agraph 7#d7 !     
foll[+3  7#e7 ,9 good /&+ ,! t]m 9 good 
/&+ means1 ) respect to a brok] or deal]
 7z ^? t]ms are def9$ 9 section #c7;a7 (
 ! ,securities ,ex*ange ,act ( #aicd    
7#ae ,u4,s4,c4 #gh;c7a7771 t1 z ( ! la/ 
day ( ! mo/ rec5tly complet$ fiscal ye> 
( ! brok] or deal]1 z applicable1 !     
brok] or deal]-- 7,a7 is regi/]$ ) !    
,commission2  7,b7 is a memb] ( an      
association t is regi/]$ z a national   
securities association "u section #ae;,a
 ( ! ,securities ,ex*ange ,act ( #aicd  
7#ae ,u4,s4,c4 #gho-#c72  7,c7 z        
reflect$ 9 ! mo/ rec5t f9ancial &       
op]ational report fil$ ) ! ,commission  
pursuant to section #ag ( ! ,securities 
,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4    
#ghq71 is 9 compliance ) section        
#bdj4ae;c#c-a ( title #ag1 ,code (      
,f$]al ,regulations1 or any successor   
regulation1 includ+-- 7i7 ! m9imum doll>

 net capital requirem5t2 &  7ii7 !      
aggregate indebt$ness ratio requirem5t2 
7,d7 has n1 dur+ ! #aj-ye> p]iod prec$+ 
t date1 be5 ! subject ( a ,commission   
ord] or adm9i/rative proce$+ ) respect  
to section #ae7;c77#c7 ( ! ,securities  
,ex*ange ,act ( #aicd 7#ae ,u4,s4,c4    
#gho7c77#c77 or section #bdj4ae;c#c-c ( 
title #ag1 ,code ( ,f$]al ,regulations1 
or any successor regulation2  7,e7 has  
n1 dur+ ! #aj-ye> p]iod prec$+ t date1  
be5 convict$ ( a felony "u ,f$]al or    
,/ate law2  7,f7 does n h a p]son       
associat$ ) ! brok] or deal]1 z def9$ 9 
section #c7;a7 ( ! ,securities ,ex*ange 
,act ( #aicd 7#ae ,u4,s4,c4 #gh;c7a771  
t1 dur+ ! #aj-ye> p]iod prec$+ t date1  
has be5 convict$ ( a ,/ate or ,f$]al    
felony-- 7i7 involv+ any securities1    
insurance1 bank+1 sav+s association1 or 
cr$it union law2  7ii7 involv+ mail or  
wire fraud2  7iii7 involv+ fraud 9      
connection ) a pur*ase or sale ( any    
security or commodity 7z def9$ 9 section
 #a;a ( ! ,commodity ,ex*ange ,act 7#g  

,u4,s4,c4 #a;a772 or  7iv7 aris+ out ( !
 conduct ( ! bus9ess (-- 7,i7 a brok]1  
deal]1 municipal securities brok]1      
municipal securities deal]1 gov]nm5t    
securities brok]1 or gov]nm5t securities
 deal]1 z ^? t]ms are def9$1            
respectively1 9 section #c7;a7 ( !      
,securities ,ex*ange ,act ( #aicd 7#ae  
,u4,s4,c4 #gh;c7a772  7,,ii7 an inve/m5t
 advis]1 z def9$ 9 section #bjb7;a7 ( ! 
,inve/m5t ,advis]s ,act ( #aidj 7#ae    
,u4,s4,c4 #hj;b-#b7;a772  7,,iii7 a     
depository in/itution1 z def9$ 9 section
 #c ( ! ,f$]al ,deposit ,insurance ,act 
7#ab ,u4,s4,c4 #ahac72  7,,iv7 a ,/ate  
cr$it union or ,f$]al cr$it union1 z ^? 
t]ms are def9$1 respectively1 9 section 
#aja ( ! ,f$]al ,cr$it ,union ,act 7#ab 
,u4,s4,c4 #ageb72 or  7,v7 an insurance 
company1 z def9$ 9 section #bja7;a7 ( ! 
,dodd-,frank ,wall ,/reet ,re=m &       
,consum] ,protection ,act 7#ab ,u4,s4,c4
 #echa7;a772 &  7,g7 is n-- 7i7 expell$ 
or susp5d$ f-- 7,i7 an association t is 
regi/]$ z describ$ 9 subp>agraph 7,b72  

or  7,,ii7 an association t is regi/]$ z
 a regi/]$ futures association "u       
section #ag ( ! ,commodity ,ex*ange ,act
 7#g ,u4,s4,c4 #ba72  7ii7 subject to an
 ord] ( ! ,commission1 o!r appropriate  
regulatory ag5cy1 or =eign f9ancial     
regulatory au?ority d5y+1 susp5d+1 or   
revok+ ! regi/ration ( ! brok] or deal] 
z a regulat$ entity2 or  7iii7 subject  
to an injunction or ord] ent]$ by a     
,f$]al or ,/ate c\rt re/ra9+ or enjo9+ !
 brok] or deal] f engag+ 9 or cont9u+   
any conduct or practice 9 connection ) !
 pur*ase or sale ( any security or 9    
connection ) any securities bus9ess4    
7#f7 ,non-c>ry+ brok] or deal] ,! t]m   
non-c>ry+ brok] or deal] means a brok]  
or deal] 7z ^? t]ms are def9$ 9 section 
#c7;a7 ( ! ,securities ,ex*ange ,act (  
#aicd 7#ae ,u4,s4,c4 #gh;c7a7771 z      
applicable1 t-- 7,a7 z ( ! la/ day ( !  
mo/ rec5tly complet$ fiscal ye> ( !     
brok] or deal]-- 7i7 has n m ?an #aej   
p]sons regi/]$ ) an association t is    
regi/]$ z a national securities         

association "u section #ae;,a ( !       
,securities ,ex*ange ,act ( #aicd 7#ae  
,u4,s4,c4 #gho-#c72 &  7ii7 is n an     
affiliate 7z def9$ 9 section #b ( !     
,bank ,hold+ ,company ,act ( #aief 7#ab 
,u4,s4,c4 #ahda77 ( an inve/m5t advisor 
t acts z ! cu/odian = cu/om] assets2    
7,b7 ?r\gh\t ! mo/ rec5tly complet$     
fiscal ye> ( ! brok] or deal]-- 7i7 does
 n-- 7,i7 receive1 directly or          
indirectly1 or hold funds or securities 
=1 or owe funds or securities to1       
cu/om]s2  7,,ii7 c>ry acc\nts (1 or =1  
cu/om]s2 or  7,,iii7 engage 9 any ( !   
activities describ$ 9 clauses 7i7 ?r\gh 
7v7 ( section #bdj4ae;c#c-a7;a77#b7 (   
title #ag1 ,code ( ,f$]al ,regulations2 
&  7ii7 if requir$ "u section #c7;a77#b7
 ( ! ,securities ,inve/or ,protection   
,act ( #aigj 7#ae ,u4,s4,c4             
#gh;ccc7a77#b771 is a memb] ( !         
,securities ,inve/or ,protection        
,corporation2 &  7,c7 fil$ an exemption 
report pursuant to section              
#bdj4ag;a-#e7;d77#d7 ( title #ag1 ,code 

( ,f$]al ,regulations1 or any successor 
regulation1 cov]+ ! mo/ rec5t fiscal ye>
 ( ! brok] or deal]4  7#g7 ,privately   
held ,! t]m privately held means1 )     
respect to a brok] or deal] 7z ^? t]ms  
are def9$ 9 section #c7;a7 ( !          
,securities ,ex*ange ,act ( #aicd 7#ae  
,u4,s4,c4 #gh;c7a7771 t ! brok] or      
deal]1 & any ultimate p>5t or o!r       
affiliate 7z def9$ 9 section #b ( !     
,bank ,hold+ ,company ,act ( #aief 7#ab 
,u4,s4,c4 #ahda77 ( ! brok] or deal]--  
7,a7 d n h a class ( securities regi/]$ 
"u section #ab ( ! ,securities ,ex*ange 
,act ( #aicd 7#ae ,u4,s4,c4 #ghl72 &    
7,b7 are n requir$ to file reports "u   
section #ae7;d7 ( ! ,securities ,ex*ange
 ,act ( #aicd 7#ae ,u4,s4,c4 #gho7d774  
4  7b7 ,am5dm5ts to regulations  7#a7   
,def9itions ,9 ?is subsection1 ! t]ms 9 
good /&+1 non-c>ry+ brok] or deal]1 &   
privately held h ! mean+s giv5 ! t]ms 9 
section #aaj ( ! ,s>banes-,oxley ,act ( 
#bjjb 7#ae ,u4,s4,c4 #gbbj71 z am5d$ by 
subsection 7a74  7#b7 ,am5dm5ts ,n lat] 

?an #ahj days aft] ! effective date     
describ$ 9 subsection 7d7-- 7,a7 !      
,securities & ,ex*ange ,commission & !  
,public ,company ,acc\nt+ ,ov]sight     
,bo>d 7ref]r$ to 9 ?is subsection z !   
,,pcaob7 %all make any necess>y am5dm5ts
 to regulations ( ! ,commission & !     
,,pcaob1 respectively1 t are 9 effect z 
( ! date ( enactm5t ( ?is ,act 9 ord] to
 c>ry out ?is ,act & ! am5dm5ts made by 
?is ,act2 &  7,b7 ! ,securities &       
,ex*ange ,commission %all am5d ! audit &
 atte/ation requirem5ts ( section       
#bdj4ag;a-#e ( title #ag1 ,code ( ,f$]al
 ,regulations1 to ! ext5t necess>y to   
reflect ! exclusion ( a non-c>ry+ brok] 
or deal] t is privately held & 9 good   
/&+ f ! audit requirem5ts ( ! ,,pcaob "u
 title ,i ( ! ,s>banes-,oxley ,act (    
#bjjb 7#ae ,u4,s4,c4 #gbaa et seq471    
includ+ by provid+ t su* brok] or deal] 
satisfies ! annual audit obligation ( ! 
brok] or deal] "u su* section           
#bdj4ag;a-#e ?r\gh an audit conduct$ 9  
accordance ) g5]ally accept$ audit+     

/&>ds4  7c7 ,rule ( con/ruction ,no?+ 9 
?is ,act1 or any am5dm5t made by ?is    
,act1 may be con/ru$ to au?orize !      
,securities & ,ex*ange ,commission to   
am5d1 waive1 or o!rwise modify-- 7#a7 ! 
requirem5t t ! auditor ( a non-c>ry+    
brok] or deal] t is privately held & 9  
good /&+ be qualifi$ & indep5d5t 9      
accordance ) "p #baj ( title #ag1 ,code 
( ,f$]al ,regulations1 z 9 effect on !  
date ( enactm5t ( ?is ,act2 or  7#b7 !  
requirem5t to file an exemption report  
pursuant to p>agraph 7d77#d7 ( section  
#bdj4ag;a-#e ( title #ag1 ,code ( ,f$]al
 ,regulations1 z 9 effect on ! date (   
enactm5t ( ?is ,act4  7d7 ,effective    
date ,! provisions add$ by ! am5dm5ts   
made by ?is ,act %all take effect on !  
date t is #ahj days aft] ! date (       
enactm5t ( ?is ,act4