Under the NASAA Custody Requirements, when can an investment adviser send account statements directly to clients?

The correct response highlights a key requirement under the NASAA Custody Requirements for investment advisers. Under these regulations, an investment adviser is allowed to send account statements directly to clients when they are audited by an independent public accountant. This stipulation is in place to ensure that there is a level of oversight and verification regarding the adviser’s handling of client funds.

Sending regular statements directly to clients helps ensure transparency and allows clients to verify the accuracy of their account balances and transactions. However, the necessity of an independent audit serves as a safeguard, confirming that the adviser's practices comply with regulatory standards before clients receive their statements. Without this independent audit, sending direct statements could raise concerns about the reliability and accuracy of the information provided to clients, potentially leading to issues of trust and compliance.

The other options do not meet the specific conditions set by NASAA for allowing direct client statements. For instance, client requests or registration with the SEC do not serve as sufficient grounds for an investment adviser to send statements independently, as these do not ensure independent verification of the account’s activity or balances. Similarly, thresholds regarding a percentage of assets do not align with the direct requirements mandated by NASAA regarding independent oversight through audits.