David Horton, CPA, CGMA, is a partner at Anchin, Block & Anchin LLP, and has more than 17 years of experience in accounting and auditing. He is a member of the Firm’s Private Equity Group and its Financial Services Practice. He provides audit and advisory services for a variety of investment company structures, including mutual funds, domestic and offshore funds, master-feeder structures, private equity, venture capital, general partnerships and management companies.
David joined Anchin in 2001 as a staff accountant following his graduation from Baruch College. He is responsible for audit engagements for financial services clients with a wide array of investments, including domestic and foreign securities, swaps, options, foreign currencies and private investments. David is also involved with advisory and compliance services for hedge funds, general partnerships and management companies.
In addition to client responsibilities, David plays a role in the recruiting, training and mentoring process at Anchin. He is involved with in-house interviewing for entry level staff from various educational institutions. David is also an instructor for in-house professional development seminars and mentors staff within the firm to nurture their advancement and accelerate their professional growth. David also serves as a mentor for Baruch College’s Executives on Campus (EOC) mentoring program.
David is a member of the American Institute of Certified Public Accountants (AICPA) and the New York State Society of Certified Public Accountants (NYSSCPA). He also serves on the NYSSCPA committee for Private Equity and Venture Capital. David continues to be involved in industry speaking events including the 2016, 2017 and 2018 Financial Research Associates (FRA) Conferences.
- Accounting and Auditing
- Financial Services
- Private Equity
- The OCIE Lays Out Six Examination Priorities for 2019January 11, 2019
Every year, the SEC’s Office of Compliance Inspections and Examinations (OCIE) publishes a report listing their priorities for upcoming examinations. For 2019, they will focus their attention on six categories.
- 2018 Financial Services Year-End Tax Planning AlertDecember 19, 2018
With the passage of the Tax Cuts & Jobs Act (the “Tax Act”) in December of 2017, the impact on funds, their owners/managers and investors has been anything but clear. The Tax Act was rushed into law, is extremely complex and still has many unanswered questions to unclear sections of the new law. However, unlike last year at this time, we do not foresee any new tax legislation before year-end 2018 nor is it clear that guidance or technical corrections will be forthcoming to address some of the open questions affecting funds, fund managers and their investors.
- Cybersecurity for Investment Partnerships, Private Equity and Real Estate Funds - Responding to a Growing ThreatJuly 30, 2018
Investment partnerships, private equity and real estate funds are tempting targets for cybercriminals thanks to their financial assets, sensitive customer information, and access to institutional counterparts. And the threat is growing quickly. Recent studies report that fifty five percent of limited partners in private equity funds expect a serious cyberattack on their firms within the next five years. How can you keep your fund safe? Let’s take a look at the current threats and latest recommendations from the SEC.
- Department of Commerce Form BE-12 Benchmark Survey of Foreign Direct Investments in the United States May be Required for U.S. Fund ManagersMay 22, 2018
Form BE-12 (Benchmark Survey of Foreign Direct Investments in the United States) is required to be filed every fifth year, in place of Form BE-15 (which is for annual reporting that falls outside of the five-year reporting). This Form is filed with the U.S. Department of Commerce’s Bureau of Economic Analysis (“BEA”). The next Form BE-12 filing is due on May 31, 2018 (June 30, 2018 if using the BEA’s e-file system).
- Impact of the Recent Tax Reform on the Private Equity IndustryMay 15, 2018
The Tax Cuts and Jobs Act (the “Tax Act”), which was signed into law on December 22, enacted a broad range of changes with most provisions taking effect for tax years beginning after December 31, 2017. This alert summarizes some of the key (federal) tax provisions of the Tax Act affecting the private equity industry.
- SEC Announces 2018 Compliance Examination PrioritiesFebruary 16, 2018
As they have for many years, the SEC announced its 2018 Office of Compliance Inspections and Examinations (OCIE) examination priorities.
- Tax Court Ruling That Family Office Carried on a Trade or Business May Offer Tax Planning Opportunities February 5, 2018
On December 13, 2017, in Lender Management, LLC v. Commissioner, the U.S. Tax Court ruled that a family office, Lender Management, LLC (“Lender Management”), carried on a trade or business as an investment manager rather than as a passive investor and was therefore entitled to deduct expenses under §162 (“deductible above-the-line with no income limitation”) vs. §212 (“miscellaneous itemized deductions subject to the 2% of adjusted gross income (AGI) floor”).
- Tax Cuts and Jobs Act: Key provisions affecting Hedge Funds, Private Equity Funds and Other Investment Funds or Fund VehiclesJanuary 17, 2018
The Tax Cuts and Jobs Act (the “Tax Act”), which was signed into law on December 22, 2017, enacts a broad range of changes with most provisions taking effect for tax years beginning after December 31, 2017. This alert summarizes some of the key (federal) tax provisions of the Tax Act affecting managers of hedge funds, private equity funds and other investment funds or fund vehicles.
- The Tax Cuts and Jobs Act Overrides the Tax Court Decision in Grecian Magnesite Mining While the IRS Seeks to Appeal the Same DecisionDecember 28, 2017
In a decision handed down in the summer, the U.S. Tax Court refused to accord deference to an Internal Revenue Service (IRS) administrative ruling treating the sale of partnership interests as the sale of assets the partnership uses in a U.S. trade or business, thereby subjecting the resulting gain to taxation as income effectively connected with a U.S. trade or business. The recently passed tax reform law overrides the Tax Court decision. Meanwhile, the IRS intends to appeal against the same decision.
- CFTC Suggests It Has Broader Jurisdiction Over Virtual Currencies, Including ICOsDecember 13, 2017
The Commodity Futures Trading Commission (CFTC) recently published a primer to educate the public on virtual currencies. In the explanation, the CFTC outlined its position regarding its role regulating virtual currencies. The primer suggests that the CFTC sees itself having jurisdiction over certain virtual currency transactions, including Initial Coin Offerings (ICOs).
- How the Senate Tax Bill Could Cost YouDecember 11, 2017
A provision in the Senate’s tax plan would take away an investor’s ability to specifically identify which stock shares they relieve when they go to sell their holdings. The provision would require investors selling a portion of a position in stock to sell their oldest shares first, also known as first-in-first-out, or FIFO. This provision is slated to take effect on stock sales starting on January 1, 2018 and is estimated to increase government revenue by $2.7 billion over the next 10 years. The House tax bill, released in early November 2017, did not address this topic.
- 2017 Financial Services Year-End Tax Planning AlertDecember 6, 2017
With Donald Trump in the White House and Republicans maintaining a majority in Congress comes the real possibility of some dramatic changes in tax law.
- SEC Rules that Digital Assets Can Be Treated as Securities, Fall Under Federal Securities LawOctober 10, 2017
Since their launch, cryptocurrencies and other digital assets have operated in a regulatory grey area. Should they be treated as currencies? Securities? As something completely different? In a July report, the SEC clarified the situation and set a new precedent: Digital assets can be treated as securities and fall under federal securities law.
- Top Lessons from the 2017 SEC Cybersecurity ReportOctober 2, 2017
Cybersecurity continues to be a top priority for the SEC. They recently reviewed 75 firms, including broker-dealers, investment advisers, and investment companies, to see what the financial industry is doing well related to cybersecurity, as well as what needs to be improved. Firms should use this information to evaluate and improve their own protection of client data and be aware of these issues which the SEC will be on the lookout for during future inspections.
- Tax Court Refuses to Follow Rev. Rul. 91-32 in Grecian Magnesite Mining DecisionAugust 23, 2017
In a recent decision, the U.S. Tax Court refused to accord deference to an Internal Revenue Service (IRS) administrative ruling treating the sale of partnership interests as a sale of assets the partnership uses in a U.S. trade or business, thereby subjecting the resulting gain to taxation as income effectively connected to a U.S. trade or business.
- Proposed Carried Interest Bills Still AliveJuly 10, 2017
Earlier this year, we shared information with you about several proposed bills that would increase taxes due on investment performance allocations, commonly known as carried interest. Carried interest is the share of profits that fund managers receive in exchange for managing investments. The controversy over carried interest arises because the current tax rules allow managers to pay taxes on portions of the carried interest allocation at the (long term) capital gains rate rather than the higher tax rate that normally applies to ordinary income.
- SEC Clarifies Three Confusing Situations For The Custody RuleMay 25, 2017
The SEC’s Custody Rule continues to be a headache for registered investment advisers. The conditions are so unclear, it’s easy to inadvertently trigger custody rule violations. To help advisers adjust, the SEC recently issued clarification for three confusing situations under the rule.
- SEC Identifies Top 5 Compliance Issues Found in OCIE ExaminationsApril 6, 2017
Call it a wake-up call for registered investment advisers—the Securities and Exchange Commission (SEC) issued a Risk Alert, highlighting the top five compliance issues found in deficiency letters sent to SEC-registered investment advisers.
- Net Worth Threshold for “Qualified Clients” Increased by SECJuly 28, 2016
The U.S. Securities and Exchange Commission (“SEC”) has decided to increase the net worth test threshold for “qualified clients” effective August 15, 2016.
- New Tax Audit Rules Constitute a Radical Change for PartnershipsJanuary 27, 2016
Late in 2015, Congress passed the Bipartisan Budget Act of 2015 (the Act), which includes a complete overhaul of the procedures that apply to Internal Revenue Service (IRS) audits of partnerships and limited liability companies (LLCs) taxed as partnerships and their partners.
- 2016 SEC & FINRA Exam PrioritiesJanuary 25, 2016
The Office of Compliance Inspections and Examinations (“OCIE”) of the Securities and Exchange Commission (“SEC”) and the Financial Industry Regulatory Authority (“FINRA”) have released their Exam Priorities for 2016. Each of the regulators have organized their focus around a number of key issues.
- 2015 SEC Examination Priorities AnnouncedJanuary 20, 2015
Last week, the SEC announced its examination priorities for 2015. Three themes highlighted the areas of focus for the SEC’s Office of Compliance Inspections and Examinations ("OCIE"): Protection of retail investors and investors saving for retirement, assessing market-wide risk and using enhanced data analysis to identify those engaged in potential illegal activity.