The Securities and Exchange Commission announced Wednesday a series of proposals aimed at modernizing and enhancing data reporting by registered investment companies and investment advisers.
For mutual funds, exchange-traded funds and other registered investment companies the SEC proposed the following:
- Submit a new monthly reporting form, which would include information on the pricing of portfolio securities; terms of derivatives contracts; information on repurchases agreements, securities lending activities and counterparty exposure; along with “discrete portfolio-level and position-level risk measures to better understand fund exposure to changes in market conditions,” according to a news release from the SEC.
- Within fund financial statements, firms must provide specific information related to derivatives, similar to the derivatives information required on the proposed monthly form. The SEC does not currently require specific information for derivative instruments such as swaps, futures and forwards.
- Provide information on funds' securities lending activities in the notes to financial statements.
The SEC also proposed for money managers to provide information on the use of borrowings and derivatives in separately managed accounts, along with additional information on business operations and the use of social media.
“These recommendations will vastly improve the type and format of the information that funds provide to the commission and to investors,” said Mary Jo White, SEC chairwoman, in the release. “Investors will have better quality and greater access to information about their fund investments and investment advisers, and the SEC will have more and better information to monitor risks in the asset management industry.”
A 60-day comment period for the proposals will start following their publication in the Federal Register.
