Full text of IVY DISTRIBUTORS, INC.'s X-17A-5 filed 2021-02-22 (period 2020-12-31). Broker-dealer annual report from SEC EDGAR — readable, searchable, and available as markdown for AI agents.
{0}------------------------------------------------ Financial Statements and Supplemental Schedules December 31, 2020 (With Report of Independent Registered Public Accounting Firm Thereon) {1}------------------------------------------------ #### Notes to Financial Statements December 31, 2020 ## (1) Summary of Significant Accounting Policies ## (a) Organization Ivy Distributors, Inc. (the Company, IDI, we, our, and us) is a wholly owned subsidiary of Ivy Investment Management Company (IICO). The Company is a broker-dealer registered with the Securities and Exchange Commission (SEC) and is a member of the Financial Industry Regulatory Authority. IDI is a wholly owned indirect subsidiary of Waddell & Reed Financial, Inc. (WDR), a publicly traded company. The Company, as a broker-dealer, has underwriting agreements with the Ivy Funds, Ivy Variable Insurance Portfolios ("Ivy VIP"), and the InvestEd Portfolios, a 529 college savings plan ("InvestEd") (collectively, the Funds) allowing the Company the exclusive right to sell redeemable shares of the Funds on a continuous basis. The underwriting agreement for InvestEd became effective as of September 1, 2020. The Company does not engage in the retail offering of the Funds, but enters into selling agreements authorizing third parties to offer the Funds. In addition, the Company receives Rule 12b-1 service and distribution fees from the Funds for purposes of advertising and marketing the shares of such Funds and for providing shareholder related services. The Company must pay certain costs associated with underwriting and distributing the Funds, including commissions and other compensation paid to sales management and other marketing personnel, compensation paid to other broker-dealers, overhead expenses related to the costs of developing and producing sales literature and printing of prospectuses, which may be either partially or fully reimbursed by certain of the Funds. The Funds are sold in various classes that are substantially structured in ways to conform to industry standards. The Company is dependent on the ongoing financial support, including capital contributions, from its parent company, IICO, due to the nature of its present operations, which results in an excess of underwriting and distribution costs over the associated revenue from such activities. The parent company has committed to provide support to the Company through December 31, 2021 and to continue to provide capital contributions in the future…Read the full text as markdown