[9994]
June 5, 1998
TO: SEC RULES COMMITTEE No. 54-98
SHAREHOLDER REPORTS TASK FORCE
RE: DRAFT LETTER TO SEC ON IMPROVING SHAREHOLDERS REPORTS
______________________________________________________________________________
Attached and summarized below is a draft of a letter from the Institute to Barry Barbash of the
SECGs Division of Investment Management suggesting certain changes to the forms of annual and semi-
annual reports. This letter is based on discussions with members of the Shareholder Reports Task Force
at its April 22, 1998 meeting.
The letter contains four principal recommendations. First, it recommends that the current
requirement to list in shareholder reports all portfolio investments held as of the last day of the reporting
period be replaced with the option to list only the a fundGs top 50 holdings. Second, the letter
recommends that shareholder reports include a graphic presentation of a fundGs portfolio investments,
such as a pie chart showing the different categories of securities held in a fundGs portfolio. Third, the
letter recommends that the ManagementGs Discussion of Fund Performance be required to be included in
a fundGs annual report, regardless of whether it is also in the fundGs prospectus. Fourth, the letter
recommends that the financial highlights table be deleted from both the prospectus and shareholder
reports.
We will be discussing this draft at the SEC Rules Committee meeting on Wednesday, June 17 at
10:00 a.m. If you will not be attending the SEC Rules Committee meeting but would like to comment on
this draft, please contact either Joe Savage (telephone: 202/326-5819, fax: 202/326-5839, or e-mail:
savage@ici.org) or Greg Smith (telephone: 202/326-5851 or e-mail: smith@ici.org) no later than
Tuesday, June 16.
Joseph P. Savage
Assistant Counsel
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