Regulation map

Eight obligation families share one post-trade operating record. Use this table to locate the rules most relevant to your role, then read the sections below for operational detail.

• One record, many computations

  Settlement events feed customer protection, net capital, margin, books and records, and supervision. When position evidence is split across systems, each computation inherits the same reconciliation risk.

• Evidence is the output

  Examinations and audits test whether the firm's records, workflows, and review trails support the computations the firm files. The operational question is whether those outputs come from one current book or from assembled extracts.

Settlement cycle

Covered trades must settle on T+1 or sooner. Trade-date affirmation and instruction readiness are what make that cycle operationally achievable.

• 15c6-1 — settlement timing

  Rule 15c6-1 limits when payment and delivery may occur for covered securities transactions. Operations teams experience it as a settlement clock that starts at execution and must resolve within the applicable cycle.

• 15c6-2 — affirmation by trade date

  Rule 15c6-2 requires policies and procedures reasonably designed to complete allocation, confirmation, and affirmation as soon as technologically practicable and no later than the end of trade date. The operational test is whether affirmation status is visible in the operating record before the trade-date window closes — not whether exceptions were cleared manually overnight.

• Instruction readiness

  Affirmation satisfies one requirement; settlement instruction is the next. In ISO 20022 workflows, instruction and status messages become part of the evidence chain. When instruction generation waits for a batch cycle, trades affirmed late in the day can miss operational cutoffs even when the rule clock has not expired.

• Fails and downstream obligations

  Unresolved settlement failures feed customer protection in-transit aging, net capital fail charges, and supervisory exception queues. Settlement is often where downstream regulatory risk becomes visible.

Customer protection

Customer assets must remain segregated and accounted for. Settlement and position records are where possession, control, and reserve inputs are won or lost.

• Reserve formula and deposits

  Rule 15c3-3 requires a reserve computation that compares customer credits and debits and funds any required deposit for the exclusive benefit of customers. The worksheet is only as reliable as the position and account classification data behind it.

• Possession and control

  Fully paid and excess margin securities must be in the firm's possession or control, or at a satisfactory control location. Operations teams track this as a status on the position record — not as a month-end reconciliation exercise.

• In-transit aging

  Securities in transit are treated differently under the rule's conditions. When in-transit positions age beyond applicable thresholds, they can affect possession/control status and reserve inputs. SOURCE CHECK REQUIRED for current rule text on in-transit timing and exemptions.

• Digital asset posture

  Where firms custody or record digital assets for customers, possession and control questions turn on wallet, ledger, and segregation evidence — the same operational discipline as DTC-held securities, with different source messages. Firms should apply their own legal analysis to classification and control location.

Capital and margin

Net capital and margin credit are computed from position and account records that must be current — not from yesterday's batch.

• Net capital — Rule 15c3-1

  The Net Capital Rule requires broker-dealers to maintain net capital above applicable minimums. Haircuts, non-allowable assets, receivables, and operational charges — including aged fails — flow from position and ledger data. Early-warning notification obligations apply before a firm reaches an actual deficiency.

• Aged fails

  Fails that remain open can generate capital charges after applicable aging periods. Operations teams need continuous fail aging in the operating record, not a weekly report that discovers the charge after it has accrued.

• Regulation T margin

  When a broker-dealer extends credit secured by securities, Federal Reserve Regulation T governs margin requirements and account documentation. Margin treatment depends on account type, instrument, and purpose — supported by the same customer and position records used for settlement and books.

• Shared inputs

  Capital and margin teams often work from extracts produced by operations. When the extract lags the trading book, risk metrics and regulatory computations diverge from what the desk actually holds.

Books and records

Every material post-trade event must be recorded, preserved, and available for audit — with a trail that shows who changed what and when.

• Rule 17a-3 — making records

  Rule 17a-3 specifies the records broker-dealers must make and keep current. Post-trade operations generate most of them: blotters, ledgers, confirmations, account records, and documentation of internal controls applied to those records.

• Rule 17a-4 — preserving records

  Rule 17a-4 governs how long records must be kept and how electronic records must be preserved. Firms need retention metadata, immutable or WORM-capable storage where required, and retrieval procedures that examinations can test.

• Rule 17a-5 — annual audit

  Rule 17a-5 requires annual financial reporting and an independent audit opinion. Auditors test whether records throughout the year support the statements filed. A December clean-up project does not substitute for continuous record integrity.

• Audit trail as infrastructure

  Approvals, amendments, break resolutions, and manual overrides must be attributable. The examination question is not only whether a record exists, but whether the firm can reconstruct the sequence of events that produced it.

Supervision and controls

Written procedures are necessary but not sufficient. Firms must evidence review and test whether controls work as designed.

• Rule 3110 — supervisory system

  FINRA Rule 3110 requires a supervisory system with written procedures, designated principals, and evidence that reviews occur. Post-trade exception queues, settlement releases, SSI changes, and manual journal entries are common examination paths.

• Written supervisory procedures

  Procedures must cover the firm's actual business lines — including digital asset activity when conducted. A procedure that describes manual review but is bypassed in production is a supervisory deficiency regardless of policy language.

• Rule 3120 — testing controls

  Rule 3120 requires principals to establish and test supervisory controls and report results to senior management at least annually. Control testing should sample the same records operations teams use daily, not a sanitized test environment.

• Maker-checker in practice

  Segregation of duties means critical changes pass through a second reviewer with an audit trail. Examinations look for evidence that the control ran — approver, timestamp, and disposition — not merely that a policy exists.

Related references