The annual audit conducted to satisfy the custody rule's audit exception. The audit must be performed by a PCAOB-registered independent accounting firm, cover the fund's complete financial statements, and the audited statements must be distributed to all fund investors within 120 days of fiscal year-end (180 days for fund-of-funds).
This is distinct from audits conducted for other purposes (LP reporting, lender requirements), though in practice the same audit usually satisfies multiple requirements.
This article is for informational purposes only and does not constitute legal advice. Consult qualified professionals for guidance specific to your situation.