Stay On Track for Success
Now is the perfect time to assess where your branch audit program stands headed into the remainder of this calendar year. As branch office inspection requirements and regulations continue to evolve, staying ahead of the curve is more crucial now than ever. The best way to ensure you finish the year strong is to take proactive steps now to address any potential gaps and complete all required audits, to help avoid non-compliance risk, potential fines or damage to your firm’s reputation.
This post will highlight some best practices for mid-year branch audit program evaluation. We’ll also outline how RegEd’s Audit Management solution and the services of our partner, Essential Edge Compliance Outsourcing Services, LLC, can streamline branch inspections and enhance compliance oversight.
Best Practices for Mid-Year Compliance
Now that we’re more than halfway through the year, here’s a simple checklist to help you evaluate your progress and stay compliant. Some of the insights below are drawn from RegEd’s report, The State of Branch Office Inspections, based on an industry-wide survey of compliance and audit professionals.
- Review Your Compliance Calendar: Ensure that all branch-level audit schedules, inspections, and deadlines are accounted for. Scheduling emerged as the most common challenge for firms, with 41% of survey respondents identifying it as the top obstacle in their branch exam programs, highlighting the critical need for proactive planning and coordination.
- Update Your Training, Documentation and Inspection Module: Confirm that your team is trained on emerging areas of regulatory focus, such as Reg S‑P changes, AI governance, and vendor oversight. Review and revise your Written Supervisory Procedures (WSPs) to reflect new regulatory guidance, and make sure that you revise your branch inspection module to audit for any mid-year policy and procedure changes for the remainder of the year.
- Prioritize Exam Focus Areas: Align your mid-year review with the top areas currently prioritized in inspections. According to survey data, firms are placing the most emphasis on Off-Channel Communications (80%), OBAs/PSTs (80%), and Books & Records (80%). Regulation Best Interest (67%) also continues to be a major area of scrutiny. Notably, the areas where firms focus aren’t always where the most findings occur, making it essential to evaluate both where your firm is placing emphasis and where historical deficiencies may re-emerge.
- Assess Risk Scoring and Branch Prioritization: RegEd’s survey finds that most financial firms (77%) reported that they conduct risk assessments for registered representatives and/or branch offices. If you haven’t already, implement or update your branch risk assessments. These should help refine your audit schedule and help identify which offices require more frequent or on-site inspections. If there are any representatives that are showing up more often on your exception reports or in conversations with supervisors, you may want to reevaluate your risk assessments for those representatives.
- Validate Your Branch Inspection Process: If you’re participating in FINRA’s Remote Inspection Pilot Program or relying on Residential Supervisory Locations (RSLs), make sure your processes align with FINRA’s expectations. This includes risk assessments, proper documentation of findings, and back-end reporting.
- Engage with Regulators Early: If you’re unsure about the regulatory requirements for the rest of the year, don’t hesitate to engage with your regulators. Being proactive in clarifying uncertainties can avoid surprises later in the year.
- Assess Your Audit Technology and Tools: Are your audit management systems efficient and automated? If not, it may be time to consider an upgrade to ensure you’re minimizing manual work and reducing human error. RegEd offers a free consultation to evaluate your current state of readiness for the future of your audit program.
- Get Outside Assistance: If your evaluation indicates your firm is off-track for being able to complete the required inspections this year, reaching out to a consulting firm now can help ensure your firm is able to arrange timely assistance in completing all inspections successfully. For example, consulting firms with multiple clients may already have trips scheduled to remote geographic locations, saving time and cost to complete those inspections. They also bring collective input from other firms to help refine your branch inspection modules. Reach out to RegEd’s partner, Essential Edge Compliance Outsourcing Services, LLC for further information on outsourced branch inspections.
For more insights, download the full The State of Branch Office Inspections report.
How RegEd Can Help
With 78% of firms using small audit teams and 73% lacking remote-ready tech, upgrading to a purpose-built platform like RegEd’s Audit Management solution can dramatically improve efficiency, visibility, and preparedness. At RegEd, we understand how important it is to stay ahead of your compliance requirements. The solution fully supports participation in the FINRA Remote Pilot Program, with capabilities designed to automate the process of planning, scheduling, conducting, remediating and reporting on your remote branch inspections. If your firm is considering participation in Pilot Year 3 of the program, the deadline for enrollment is December 27th, 2025. RegEd is available to guide you through the process of ensuring the proper tools and technology are in place, incorporating valuable feedback from current participants. Regardless of whether you are participating in the remote pilot, these powerful features enhance inspection and deficiency tracking for all firms.
Our Audit Management solution is designed to help you streamline your audit processes and minimize the risk of non-compliance. Here’s how we can assist:
- Automated Workflow Management: RegEd’s Audit Management solution automates much of the compliance workflow, from tracking documents to scheduling audits, while helping your team stay organized and efficient.
- Real-Time Compliance Tracking: Our solution enables you to track compliance activities in real-time, ensuring you’re always aware of where you stand and can address issues promptly.
- Comprehensive Reporting: With customizable reporting features, you can generate detailed audit reports and compliance summaries at any point, ensuring you’re always prepared for regulatory reviews.
- Collaboration and Communication: RegEd allows multiple teams to collaborate on audits, all within one central location, making it easy to coordinate and communicate with stakeholders across your firm.
- Consistency: RegEd’s Audit Management solution ensures a consistent, uniform approach to scheduling, conducting, tracking and reporting for your audit program.
With these features, RegEd ensures your firm remains compliant and minimizes risk, helping you avoid penalties and reducing the manual effort that can bog down your compliance efforts.
How Essential Edge Can Help
Essential Edge has a team of seasoned, former CCO’s who conduct 1000’s of branch office inspections across the country each year. By using an experienced examiner, you will have someone who can not only conduct the inspection thoroughly and efficiently, but also someone you will be comfortable interacting with your representatives. Essential Edge can also help review your branch audit module and suggest modifications for compliance reasons as well as for aligning your procedures with the best practices of the dozens of broker/dealers for which they are already conducting branch audits.
Conclusion: Stay Ahead, Finish Strong
By taking a proactive approach to your compliance requirements and integrating best practices into your routine, you can ensure that your firm is prepared for the rest of the year. Whether it’s updating your training, reviewing your documentation, or upgrading your audit management tools, staying ahead is the best way to stay on track.
Don’t wait until the last minute to address compliance issues. Leverage the tools and support available to you, like RegEd’s Audit Management solution, to help you stay on track and finish the year strong.
About RegEd
RegEd is the market-leading provider of RegTech enterprise solutions with relationships with more than 200 enterprise clients, including 80% of the top 25 financial services firms.
Established in 2000 by former regulators, the company is recognized for continuous regulatory technology innovation with solutions hallmarked by workflow-directed processes, data integration, regulatory intelligence, automated validations, business process automation and compliance dashboards. The aggregate drives the highest levels of operational efficiency and enables our clients to cost-effectively comply with regulations and continuously mitigate risk.
Trusted by the nation’s top financial services firms, RegEd’s proven, holistic approach to RegTech meets firms where they are on the compliance and risk management continuum, scaling as their needs evolve and amplifying the value proposition delivered to clients. For more information, please visit www.reged.com.