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As I mentioned yesterday, FINRA is closely reviewing vendors used by IPI advisors that can produce Consolidated Account Statements. To limit any level of deficiencies we may receive from FINRA, we have to conduct an immediate review of these products and amend our procedures which are attached. These procedures will go into effect as of October 1, 2016. Please print out Page 3 of the attached document, sign and return it to Compliance as it is an attestation that all advisors will need to return indicating your understanding of the procedures and your usage of the systems, if any, for Consolidated Account Statements.

What is a Consolidated Account Statement? It is any report, spreadsheet or typed information on letterhead that summarizes (or restates) a client's security position(s), account value(s) or performance.

What is not a Consolidated Account Statement? Scratch pads, handwritten notes and other less organized valuations used (or intended to be used) with a client.

What does used/intended to be used mean? This means hand delivery, emailing or mailing a report to a client.

We currently have 3 approved systems - Envestnet, eMoney and MoneyGuidePro. Of these three (3), Envestnet has the most controls in place for the home office staff to be able to supervise this activity. We encourage our advisors to utilize Envestnet. Therefore, if you use Envestnet there will be only minimum new procedures with this system. We fully understand that most of our offices use eMoney and MGP as financial planning tools. However, these systems allow for summaries of a client's holdings which fall under the definition of a Consolidated Account Statement per the regulators. Futhermore, eMoney and MG have lesser controls than Envestnet, which makes it more difficult for us to review and supervise. Therefore, we have to enhance our procedures for the use of these systems, regardless if you are only using them as a planning tool --- again, I apologize for any inconvenience this may cause.

Envestnet Changes:

1) If you hand deliver, email or mail a report to a client with their holdings on it from Envestnet, you will be required to upload the report to Docupace and set it for Correspondence Review or if you do not have Docupace, email it to Compliance within 30 days of the report being provided to the client. As Envestnet/IPI home office controls the manual entries of assets held away and their values listed on these reports, you do not have to upload reports with manual entries within 48 hours.

2) Some advisors previously had the ability to update held away asset values through Envestnet. This has been shut off. On a go forward basis, the home office will make the update to the values. Therefore, you will need to provide an updated statement to Mary Yeager for any changes.

eMoney and MoneyGuidePro Changes:

1) If you hand deliver, email or mail a report to a client with their holdings on it from eMoney or MGP, you will be required to upload the report to Docupace and set it for Correspondence Review or if you do not have Docupace, email it to Compliance within 30 days of the report being provided to the client if it does not include manual entries. If the report includes manual entries, it must be uploaded within 48 hours of delivery to the client with the appropriate disclosures, see attached Consolidated Account Statement Procedures/Attestation.

2) You will need to review the accounts you have set up on the applicable system (eMoney or MGP) and exclude any holdings from the system in which you do not have a current valuation of an investment. We understand that this may take time; however, we expect full compliance by 12/31/16. Additionally, you will need to rename any assets held away per the attached procedures in order for clients and the home office to be able to properly identify them as assets held away.

3) Valuations (statements showing an asset's value with the logo on the statement) will need to be uploaded to Docupace under the applicable client (no review needed) or sent to the Compliance email address if you do not have Docupace. For new assets held away, upload the statement with the report.

4) You will need to have either eMoney or MGP change the disclosures on your reports to include the attached language listed in the Word document: Consolidated Account Disclosures.

Other Systems/Self-Made Reports Changes:

1) If you hand deliver, email or mail a report to a client with their holdings, you will be required to upload the report to Docupace and set it for Correspondence Review or if you do not have Docupace, email it to Compliance within 30 days of the report being provided to the client. If the report includes non-IPI held assets, it must be uploaded within 48 hours with the appropriate disclosures, see attached Consolidated Account Statement Procedures/Attestation. Valuations (statements showing an asset's value with the logo on the statement) will need to be uploaded with the report to Docupace under the applicable client (no review needed) or sent to Compliance email address if you do not have Docupace.

2) Update your disclosures to include the attached language listed in the Word document: Consolidated Account Disclosures.

I am sure there will be a lot of questions and we may have to make a few adjustments, please be gentle with your comments. We wanted to also answer a few FAQs that may assist with the process.

1) If I do not use Consolidated Account Statements, but I have accounts listed on eMoney or MGP, do I still need to change the disclosures for the applicable system per the attached Word document?

Answer: Yes.

2) If I do not use Consolidated Account Statements, but I have accounts listed on eMoney or MGP, do I still need to complete a review of my accounts by 12/31/16 regarding assets held away and exclude them?

Answer: Yes.

3) If an advisor or a client added an asset held away (Ex: Employee Stock Plan, another brokerage account, checking, etc.) and there are no statements to value the investment/account, what should an advisor do?

Answer: Exclude the investment/account from the report through eMoney and do not use the asset in the plan/remove it from the plan if it is currently listed with MGP.

4) I only use the reports for planning purposes with a client. Do I still need to follow these steps?

Answer: Yes, unless you obtain a separate Financial Planning engagement through an advisory agreement with the client. As our normal process, the advisory agreement must then be sent to Operations for processing and approval.

 Consolidated Statement Procedures and Attestation

 Consolidated Account Disclosures