June 4, 1996
TO: SEC RULES COMMITTEE No. 52-96
RE: POSSIBLE MODIFICATIONS TO FORM N-SAR
______________________________________________________________________________
As you know, the next meeting of the SEC Rules Committee will be held on June 19th at
the Institutes offices. We intend to include on the agenda Institute consideration of possible
modifications to Form N-SAR. (We understand that the SEC staff also is reviewing the form
and plans to propose amendments later this year.)
The issues that the Committee may wish to consider include the following:
What purposes should the form serve? We understand that the SEC uses Form N-
SAR in its inspections and as a source of data for Congress and the public. In
addition, the form is a publicly-filed document that is available to investors and
other members of the public.
To what extent does the form meet its objectives? Could they be met through more
efficient means (e.g., greater reliance on industry statistics; redesign of SEC
databases to facilitate presentation of data from other forms)? Are some items of the
form unnecessary for these purposes (e.g., Item 45, concerning whether the fund has
had an advisory contract during the period covered by the report)?
Is information required by the form redundant of information provided under other
forms (e.g., financial information; minimum investment; descriptions of material
legal proceedings)? If so, should these items be deleted?
How should the form be updated to reflect changes to the SECs rules and more
recent developments in the industry? For example, should multiple class funds be
required to provide data with respect to each class?
Is there information that should be added to the form?
Please be prepared to discuss these issues and any suggestions for other issues related to
Form N-SAR at the June 19th meeting. If you have any comments in advance of the meeting, or
if you will be unable to attend, please feel free to contact me at 202/326-5819.
Thomas M. Selman
Associate Counsel