Every federal firearms licensee is required to keep a record of every firearm that enters and leaves the business. That record is the A&D book, short for acquisition and disposition, and it is the first thing an ATF investigator asks for when they walk through your door.
Some dealers still call it the bound book, a holdover from the days when the regulations assumed a physical ledger. Whatever you call it, the rules about what goes in it, and when, are specific. Most compliance problems FFLs run into are not exotic. They are ordinary entries made late, made incompletely, or not made at all.
Here is what the regulations actually require, in plain language.
What Counts as an Acquisition, and When It Must Be Recorded
An acquisition is any firearm coming into your business inventory: a distributor shipment, a used gun bought over the counter, a trade-in, a customer consignment, a pawn intake, or a transfer received for a customer. The regulation gives you until the close of the next business day after the firearm arrives to make the entry.
The entry must include the date of acquisition, the name of the manufacturer or importer, the model, the serial number, the type, the caliber or gauge, and who you received it from. For a licensee, that means their name and license number. For a private individual, their name and address, or their driver's license number if your state uses that convention.
The common failure here is not ignorance. It is workflow. A shipment gets received on the floor, tagged, and priced, and the record entry becomes "later." Later becomes Friday. Friday becomes a violation that an investigator can spot in minutes by comparing receiving paperwork against entry dates.
What Counts as a Disposition, and the Seven-Day Rule
A disposition is any firearm leaving your inventory: a retail sale, a return to distributor, a transfer to another dealer, a theft or loss, or a pawn redemption. Sales to non-licensees must be recorded within seven days of the transfer, and the entry must tie back to the serial number recorded at acquisition.
For a sale to an individual, the disposition entry must reference the buyer's name and the serial number of their completed Form 4473, or their name and address. This is where the A&D record and the 4473 become one connected system: an investigator will trace a serial number from acquisition, to disposition, to the exact 4473 behind it. If any link in that chain is missing, that is a citation.
The Entries Dealers Forget
- Gunsmithing and repairs. A firearm held overnight for repair is an acquisition and its return is a disposition, unless it is returned to the owner the same day.
- Pawn transactions. A pawned firearm is an acquisition at intake. A redemption is a disposition, and the redemption requires a 4473 and a background check even though the customer owns the gun.
- Theft or loss. Discovered theft or loss must be reported to the ATF and recorded as a disposition, with the report number in the entry.
- Personal firearms. Moving a firearm from business inventory into your personal collection has its own recording requirements and a waiting period before resale rules change. It is not simply "taking it home."
Electronic A&D Records Are Fully Legal, With Conditions
The ATF permits electronic A&D records through ATF Ruling 2016-1. The system has to meet specific conditions: entries cannot be silently deleted or overwritten, corrections must preserve the original entry, the records must be backed up daily, and you must be able to produce complete records for an investigator on demand, at your licensed premises, without delay.
An ordinary spreadsheet, used the way spreadsheets are typically used, struggles with several of those conditions. Cells can be edited without preserving what they said before, and that is precisely the behavior the ruling is designed to prevent. Purpose-built electronic A&D systems exist because the audit trail, not the data entry, is what the ATF cares about. This is the core of what compliance software does, whether standalone or built into a point of sale system like Bravo's gun store software, where the acquisition entry is created by the same action that receives the item into inventory, so the record and the physical gun move together instead of drifting apart.
How Long Records Must Be Kept
A&D records must be retained for as long as you hold your license. When a licensee goes out of business, the records do not get shredded. They must be delivered to the ATF's Out of Business Records Center, or to the successor if the business is sold. Completed 4473s follow their own retention rules, and since 2022 they must be kept for as long as you remain licensed.
What an Investigator Actually Does With Your A&D Book
During a compliance inspection, the investigator performs a physical inventory reconciliation: every open acquisition entry should match a firearm on the premises, and every firearm on the premises should match an open entry. Guns without entries and entries without guns are both findings. Then they sample the chain: serial number to disposition to 4473 to NICS documentation.
Dealers who reconcile their own records against physical inventory on a schedule, monthly for high-volume stores and quarterly at minimum, almost never get surprised by an inspection. Dealers who reconcile for the first time when the investigator arrives usually are. If you want a structured self-check before that day comes, start with our ATF audit readiness review.
The Bottom Line
The A&D requirements are not complicated. They are unforgiving of drift. The dealers who stay clean are the ones whose recordkeeping happens as a side effect of doing the transaction, not as a separate chore stacked up for the end of the week. That is a workflow decision, and it is the single highest-leverage compliance decision an FFL makes.
See how Bravo keeps the A&D record and the transaction in one step.