[9366]
October 24, 1997
TO: CLOSED-END INVESTMENT COMPANY COMMITTEE No. 39-97
RE: DRAFT LETTER ON CALCULATION OF EXPENSE RATIO
______________________________________________________________________________
We understand that the SEC plans to issue shortly a generic comment letter that will
suggest that the value of any preferred shares outstanding should be excluded from average net
assets when calculating the funds expense ratio to be included in the funds financial
highlights table. Attached is a draft letter which suggests that funds should continue to be able
to include the value of preferred shares when calculating their expense ratio, consistent with
the current requirements of Form N-2.
As discussed at the Committees October 23 meeting, the SEC staff plans to issue the
generic comment letter in the next several days. Accordingly, please call the undersigned
(202/326-5851) with any comments on the draft letter by close of business on Monday, October
27.
Gregory M. Smith
Director - Operations/
Compliance & Fund Accounting
Attachment (in .pdf format)