1 See Memorandum to Accounting/Treasurers Members No. 5-96, Money Market Funds Ad Hoc Committee No.
4-96, Money Market Members - One Per Complex No. 1-96 and SEC Rules Members No. 14-96, dated March 25, 1996.
May 13, 1996
TO: ACCOUNTING/TREASURERS MEMBERS No. 15-96
MONEY MARKET FUNDS AD HOC COMMITTEE No. 6-96
MONEY MARKET MEMBERS - ONE PER COMPLEX No. 3-96
SEC RULES MEMBERS No. 25-96
RE: SEC STAFF INTERPRETIVE LETTER ON AMENDMENTS TO RULE 2a-7
______________________________________________________________________________
The staff of the Division of Investment Management has issued an interpretive letter on
a variety of issues regarding the recently adopted amendments to Rule 2a-7 under the
Investment Company Act of 1940. 1 The letter was prepared in a question and answer format, and responds to inquiries that the staff has
received regarding the rule amendments. Specifically, the letter addresses questions dealing with puts, demand features, repurchase agreements, asset backed
securities, pre-refunded bonds and several miscellaneous issues (e.g., the need for a shareholder vote to modify a fund*s fundamental policy dealing with
diversification and clarification of the recordkeeping requirements regarding a fund*s minimal credit risk determination). A copy of the staff*s letter is attached.
Amy B. R. Lancellotta
Associate Counsel
Attachment