RIAs understand the importance of staying aligned with the SEC’s billing and invoicing standards. Accuracy, transparency, and consistency with advisory agreements are table stakes. But as more firms expand across state lines, advisors are experiencing increased complexity introduced by state-level rules that build on top of the SEC baseline.
In this environment, navigating invoicing requirements isn’t just a billing task — it’s part of a firm’s broader compliance strategy.
RIA compliance requirements for billing and invoicing
Before diving into state-level nuances, it’s important to ground ourselves in the standards all RIAs must follow. The SEC expects advisors to be accurate and transparent in their fee calculations ensuring calculations match their advisory agreements and their Form ADV. Invoices are to include key details like the calculation method, billing period, assets or accounts involved, the charged amount, and any prorations or adjustments. Advisors must also follow custody rules, which may require sending invoices directly to clients when fees are deducted from their accounts.
The SEC establishes the foundation, but states often expand, modify, or add to these requirements, adding complexity.
State-level RIA invoice requirements add complexity
While many states closely mirror the SEC’s standards, others impose additional disclosures, delivery rules, registration expectations, or even tax implications that affect how and when invoices must be prepared and sent.
And importantly, billing through a custodian does not always satisfy state requirements. Several states require RIAs to deliver a separate invoice directly to clients, regardless of fee-debiting practices.
Below are just some examples of states that introduce incremental requirements. These are not exhaustive and should always be verified with your state regulator.
North Carolina
North Carolina is one of the more prescriptive states. Invoices may need to include:
- Client name
- Description of services
- Fee calculation method
- Billing period
- Amount charged
- Invoice date
- Payment terms
Many firms are also required to send a separate invoice directly to the client, even when fees are debited through a custodian.
California
California requires investment advisers who directly deduct fees to send clients an invoice or statement concurrently that explicitly itemizes the fee deducted.
Colorado
Colorado requires financial advisors to maintain a record of all bills, statements, and invoices (paid or unpaid) related to their investment adviser business.
Florida
Florida may require additional clarity in disclosures or separate client communications, depending on the structure of the engagement. Advisors should confirm whether their invoice format addresses state expectations for transparency.
Minnesota
Minnesota requires investment advisory contracts and Form ADV Part 2A to clearly disclose the firm's fees and services to clients.
Nebraska
Nebraska requires advisors to file copies of all client advisory contracts and agreements that detail the firm's fee structure.
New Jersey
New Jersey requires firms to submit copies of all current standard client advisory contracts and financial statements to the state during registration.
New York
New York may require additional documentation or invoice details beyond SEC standards, particularly around fee calculation and service descriptions. Requirements may vary based on service type and registration status.
Oklahoma
Oklahoma requires investment advisors to maintain detailed records of all bills, statements, and invoices (paid or unpaid) related to their advisory business.
Pennsylvania
In Pennsylvania, if an advisor deducts fees directly from a client account, they must concurrently send the client a detailed invoice or statement.
Washington
Washington mandates that written billing information must include the fee(s) charged, the calculation formula, the calculation itself, the amount of assets under management the fee is based on, the time period covered, and every day’s value if billing on Average Daily Balance (ADB).
Requirements change, and interpretations vary. RIAs should always confirm state rules before finalizing processes or invoice templates.
Manage operational and regulatory risk with cloud-based billing software
RIAs need to stay focused on clients, not on administrative burdens. But state-by-state invoicing requirements can create challenges:
- Manual invoice customization introduces errors
- Inconsistent formats increase exam risk
- Custodial billing alone may fall short of state expectations
- Tracking state rules across a growing client base becomes time-consuming
This is where technology plays a critical role in reducing risk and driving efficiency. BillFin was built for precisely these kinds of challenges.
Automated, accurate fee calculations
BillFin minimizes manual work so invoices can reflect your expectations.
Invoice templates aligned with regulatory expectations
Firms can prepopulate required disclosures, including those mandated in states like North Carolina.
Customization for state-specific needs
Advisors can add or modify invoice fields to reflect evolving state rules. For example, advisors in Washington who bill using Average Daily Balance can be compliant by using BillFin’s daily balance appendix.
Direct client delivery through eDocs
For states that require invoices to be sent separately — even when fees are debited via custodians — BillFin’s secure eDocs feature creates an audit-ready delivery process with one click of the button.
Scalability for multi-state growth
Whether you serve clients in one state or twenty, BillFin ensures your invoicing stays consistent and efficient as your firm expands.
How modern billing software can handle state-specific compliance requirements
Riverbend Advisory, a hypothetical mid-sized RIA, recently expanded into North Carolina, Texas, and Illinois. Like many growing firms, they discovered that each state carried its own expectations:
- North Carolina required additional invoice fields and direct delivery
- Texas required a notice filing once they added their second client
- Illinois required registration details tied to each branch office
Initially, Riverbend relied on spreadsheets and manual edits for each state’s clients. That approach quickly became unsustainable.
After adopting BillFin, their workflow transformed:
- Fee calculations became automated and consistent
- State-specific disclosures were maintained through templates within BillFin
- eDocs enabled secure direct delivery to NC clients
- Billing time dropped by nearly 50%, and exam readiness improved dramatically
Using the right technology can also enable your team to stop worrying about missed disclosures and refocus on client service.
Simplify compliance and strengthen your firm’s billing foundation
State-level invoice and billing requirements aren’t going away, and they’re becoming more nuanced as regulators continue to evolve their expectations. It is critical that firms remain proactive, consistent, and transparent in their billing practices.
Cloud-based advisory billing software like BillFin helps streamline that work, reduce regulatory risk, and free your team to focus on what matters most: delivering value to clients.
Ready to simplify multi-state billing and invoice delivery?
Learn how BillFin helps RIAs streamline invoicing and meet state requirements.
