SEC Issues Investment Company ‘Reporting Modernization' Rules

In May 2015, we reported on proposals by the US Securities and Exchange Commission designed to enhance reporting for mutual funds, ETFs and other registered investment companies.¹ On October 13, 2016, the SEC voted to adopt new rules, largely as proposed, that will significantly expand the reporting of information about funds and their portfolio of investments.

The SEC's original proposal included four sets of reforms (i) a new Form N-PORT facilitating monthly portfolio and risk reporting and rescission of Form N-Q, (ii) a new Form N-CEN, an annual "census-style" reporting form that would replace an obsolete existing SEC form (Form N-SAR), (iii) amendments to Regulation S-X, requiring more derivatives disclosures in fund financial statements and (iv) a new Rule 30e-3 to permit posting shareholder reports to a website instead of mailing them under certain circumstances. The first three sets of reforms have been adopted; however,in the face of very mixed comments from