Congress had required executives at public companies to certify quarterly and annual financial results as part of a sweeping accounting reform bill adopted last summer (see SEC Fills in Sarbanes-Oxley Details ). The SEC’s most recent action imposes a similar mandate on mutual funds and other registered investment management companies.
Mutual funds also will be required to tell shareholders whether they have a code of ethics, and if not, why they don’t. Funds that have ethical codes would have to alert shareholders anytime the code is waived. The SEC adopted the same rule for public companies earlier this month (see SEC Adopts New Blackout, Financial Disclosure Rules ).
Similarly, funds will be required to disclose whether they have a designated financial expert on the audit committee of the fund’s board, tracking a new requirement imposed on public companies.
Closed-end mutual funds and unit investment trusts will be subject to the same rules as open-end mutual funds and other registered investment companies, the SEC said.
Under the new rule chief executives and chief financial officers at mutual funds will be required make those certifications on a newly created form, Form N-CSR, according to the SEC.
The SEC announcement is at http://www.sec.gov/news/digest/dig012203.txt .