Series 27 vs. Series 28 FINOP: What's the Difference?
Series 27 and Series 28 are FINRA principal qualification examinations for financial and operations responsibilities. The difference centers on the type of broker-dealer and the scope of activities the principal is qualified to supervise.
The firm's specific registration requirements should be confirmed before designation
Series 28 for Introducing Broker-Dealers
Quick comparison: Series 27 covers the broader Financial and Operations Principal qualification. Series 28 covers the introducing broker-dealer qualification for firms that do not carry customer accounts or hold customer funds or securities. The firm's activities and registration requirements determine the appropriate category, not whether its FINOP works full-time or part-time.
The Series 28 is formally the Introducing Broker-Dealer Financial and Operations Principal Qualification Examination. FINRA describes it as the qualification for a principal performing the financial and operational functions of an introducing broker-dealer that does not carry customer accounts or hold customer funds or securities.
The examination covers four major functional areas:
- Financial reporting
- Operations, general securities-industry regulations, and preservation of books and records
- Net capital
- Customer protection, funding, and cash management
FINRA states that broker-dealers outside the categories requiring Series 27 are permitted to use the Series 28 qualification. FINRA's Series 28 overview explains its scope and permitted activities.
Series 27 for Broader FINOP Responsibilities
The Series 27 is the Financial and Operations Principal Qualification Examination. It applies to FINOP responsibilities beyond the limited introducing-firm scope covered by Series 28.
FINRA specifically identifies broker-dealers with a minimum net capital requirement of $250,000 and municipal securities brokers with a minimum net capital requirement of $150,000 under SEC Rule 15c3-1 as firms whose FINOP must pass Series 27. Firm activities, customer-account structure, clearing responsibilities, and other registration requirements can also affect the correct designation.
The practical takeaway is that Series 27 is not simply a more senior title and Series 28 is not simply a part-time license. They are different qualification categories tied to the firm's regulatory profile.
FINRA's Series 27 overview provides the examination scope and registration information.
Before choosing FINOP coverage, review the firm's approved activities, clearing agreement, customer-account arrangements, minimum net capital requirement, and existing principal registrations. If the firm plans to change its business model, confirm whether those changes affect the required qualification before relying on existing coverage.
Responsibilities Shared Across the FINOP Function
Although the qualification categories differ, FINRA Rule 1220 assigns the FINOP function a defined set of responsibilities. These include final responsibility for the accuracy and preparation of financial reports submitted to regulators, supervision of the people and records supporting those reports, responsibility for financial-responsibility rules, and oversight of back-office financial operations.
For an introducing broker-dealer, the work commonly translates into:
- Maintaining reliable accounting records and reconciliations
- Preparing or reviewing net capital computations
- Preparing and reviewing FOCUS filings
- Coordinating annual-audit schedules and open items
- Supporting financial portions of regulatory examinations and inquiries
- Maintaining a documented close, review, and reporting calendar
FINRA Rule 1220 provides the controlling description of FINOP duties and qualifications.
Series 27 and Series 28 Questions
Key distinctions for broker-dealer operators evaluating FINOP coverage.
Can a Series 27 FINOP work with an introducing broker-dealer?
FINRA states that a person seeking registration as an Introducing Broker-Dealer Financial and Operations Principal may qualify through the Series 27 or Series 28 examination. The firm's specific designation and registration should still be confirmed.Is Series 28 only for fractional or outsourced FINOPs?
No. Series 28 describes the qualification category and permitted scope for an introducing broker-dealer FINOP. It does not determine whether the professional is an employee, outsourced, full-time, or fractional.Does passing an examination automatically authorize someone to act as a firm's FINOP?
No. Qualification examinations are part of the registration process. The individual must also be properly associated, sponsored, and registered for the applicable role through the relevant member firm.Series 28 Support for Introducing Broker-Dealers
I provide outsourced and fractional Series 28 FINOP support for introducing broker-dealers, including books and records, net capital, FOCUS reporting, annual audits, and regulatory response coordination.