{"data":{"id":"us-ky/krs-154.20-277","jurisdiction":"us-ky","citation":"KRS 154.20-277","heading":"Annual examination of investment funds by authority and Department","body":"of Revenue -- Other audits -- Department's powers of enforcement -- Notice of\nnoncompliance -- Examination, investigative, and enforcement powers of\nsecurities regulatory organizations.\n(1) Each year the annual financial statements and annual reports of the investment fund\nshall be delivered to the authority within ninety (90) days after the end of the\ninvestment fund's fiscal year.\n(2) The authority and the Department of Re venue, individually or collectively, may\nexamine, under oath, any of the officers, trustees, partners, members, managers,\ndirectors, agents, employees, or investors of an investment fund regarding the\naffairs and business of the investment fund. The author ity and the Department of\nRevenue, individually or collectively, may issue subpoenas and subpoenas duces\ntecum and administer oaths. Refusal to obey such a subpoena or subpoena duces\ntecum may be reported to the Franklin Circuit Court, which shall enforce the\nsubpoena or subpoena duces tecum according to the rules of civil or criminal\nprocedure, as applicable.\n(3) In addition to the audits required by this section, the authority or the Department of\nRevenue may audit one (1) or more investment funds or inve stment fund managers\nin any year on a random basis or for cause. The authority or the Department of\nRevenue may also audit, for cause, any small business in which an investment fund\nhas made a qualified investment. Nothing in this section shall be construe d to\nprohibit the Department of Revenue from conducting any audit relating to the\nadministration or enforcement of the tax laws of the Commonwealth which the\nDepartment of Revenue determines to be appropriate.\n(4) If any audit conducted pursuant to this se ction discloses that an investment fund or\ninvestment fund manager is not in compliance with the provisions of KRS 141.068\nand KRS 154.20 -250 to 154.20 -284, the authority and the Department of Revenue\nmay consult with one another with respect to this nonco mpliance and the\nDepartment of Revenue may exercise any of its powers to protect the\nCommonwealth's interest and to enforce the provisions of KRS 141.068 and KRS\n154.20-250 to 154.20-284.\n(5) The authority may give an investment fund manager written notice  of any\nnoncompliance with the provisions of KRS 154.20 -250 to 154.20-284 and specify a\nperiod of time the investment fund manager shall have to cure any noncompliance.\nFailure to cure any such noncompliance within the period of time specified by the\nauthority may result in further action by the authority pursuant to this section.\n(6) Nothing in this section shall be construed to prohibit the Department of Financial\nInstitutions, Division of Securities, or any other securities regulatory organization or\nbody with jurisdiction over the activity of an investment fund or the investment\nfund manager from conducting any examination or investigation relating to the\nsecurities activities of the investment fund or investment fund manager. If any\nexamination or inves tigation conducted pursuant to any securities laws or\nregulations discloses that an investment fund or investment fund manager is not in\ncompliance with any provision of any applicable securities laws or regulations, the\nappropriate securities regulator ma y take whatever action it deems appropriate in\naccordance with such securities laws and regulations to respond to the\nnoncompliance, notwithstanding any action the authority or the Department of\nRevenue may or may not take with respect to the noncompliance.","path":[],"source_url":"https://apps.legislature.ky.gov/law/statutes/statute.aspx?id=51551","current_through":"Includes enactments through the 2026 Regular Session","vintage":"09/05/2026","retrieved_at":"2026-09-05T20:50:53Z","sha256":"7c0a2ce80645c6cd5ee600e860206ec721229a7c3971f9cff13c164a2cedde77","source_id":"us-ky","stale":false,"prev":"us-ky/krs-154.20-273","next":"us-ky/krs-154.20-279"},"notice":"GroundRules: Original legal text. Not legal advice."}