The Securities and Exchange Commission has approved the adoption of Form PF to collect critical systemic risk data about hedge funds and private funds. The form, jointly issued by the Commodity Futures Trading Commission and the Financial Stability Oversight Council (FSOC), will be used to monitor the systemic risk these funds may pose. The data collection is mandated by the Dodd-Frank Act.

Meanwhile, regulators are also adopting the new Form ADV, which aims to collect data of private funds. Information collected on Form PF by regulators will be made available to the FSOC only, while information on Form ADV will be available to both the FSOC and the investing public. Form ADV will contain information such as private fund size, its managers, and the “gatekeeper” of the entity, including auditors and custodians.

“This private fund data collection initiative follows from the lessons learned during the financial crisis—lessons about the importance of monitoring and reducing the possibility that a sudden shock or failure of a financial institution will cascade through the entire financial system,” said Chairman Mary Schapiro in a statement.

The newly adopted proposal has incorporated some recommended changes as proposed by the SEC staff. They include:

Reporting is only required for hedge fund advisers with $1.5 billion in assets under management, liquidity fund advisers with $1 billion assets; and private equity funds with at least $2 billion in assets

The data collection form will require less information from large private equity funds compared with data required from large hedge fund and liquidity funds advisers

Filing deadlines for large hedge fund advisers extended from 15 days to 60 days

For smaller advisers and private equity funds advisers, deadlines are extended to 120 days up from 90 days

Large private equity fund managers will only file Form PF once a year; filing frequency for hedge funds and liquidity funds remain at quarterly intervals

The Commission said there will be a two-stage phase-in period for fund advisers to comply with Form PF filing requirements.  However, all fund advisers with at least $5 billion in assets must begin filing Form PF at the end of their first fiscal year or quarter, on or after June 15, 2012.  Most other private fund advisers will be required to file Form PF following the end of the first fiscal year or quarter, on or after Dec. 15 of next year.

As part of the Dodd-Frank requirement, private fund advisers have to maintain records and file reports containing information that the SEC deems necessary and appropriate for investor protection, public interest, or for the assessment of systemic risk by the FSOC. The requirement stated that the records must include a description of the amount of assets under management, use of leverage, counter-party credit risk exposure, and trading and investment positions for each private fund manged by the adviser.