SEC Disclosure Update and Simplification Release

Posted by John Braun on Nov 16, 2018 3:15:31 PM

On August 17, 2018, the SEC adopted what effectively amounts to “housekeeping items” for a variety of public issuers. These updates are effective November 5, 2018. 

Read More

Updates To Disclosure Requirements For Fair Value Measurements: What You Need To Know Relevant To Registered Investment Companies

Posted by admin on Nov 6, 2018 12:18:53 PM

In August 2018, the Financial Accounting Standards Board (FASB) finalized changes to fair value measurement disclosure requirements that had been under debate for several years as part of the disclosure framework project.

Read More

Another ETF Accounting Trap

Posted by James Kaiser on May 7, 2018 3:30:12 PM

Today I am writing about an accounting error I have been seeing more and more while performing audits of exchange traded funds (“ETFs”).

Read More

Considerations For Mutual Funds For Allocating Earnings and Profits to Distributions

Posted by James Kaiser on Oct 10, 2016 7:05:00 PM

In this post, we’ll consider the following:

  • Current requirements, as updated by the RIC Modernization Act of 2010, for allocating earnings and profits across multiple distribution dates in instances where total annual distributions exceed earnings and profits for funds that have fiscal year ends that span two calendar years (e.g.  non-calendar fiscal year end funds)
  • Why this requirement may impact the reporting of distributions in a semi-annual report
Read More

How to Account for Commission Recapture Program Rebates

Posted by admin on Apr 29, 2014 3:02:08 PM

Commission recapture occurs when a fund enters into an agreement with an institutional broker to rebate a portion of trading commissions directly to a fund. How does commission recapture work?

Read More

IRS Form 8937- Reporting Corporate Actions

Posted by admin on Aug 8, 2013 1:59:47 PM

Starting in 2012, Regulated Investment Companies (“RIC’s”) are required to file Form 8937 to report corporate actions that affect the basis of the RIC stock. Such corporate actions include, but are not limited to, mergers, stock splits, spin-offs, return of capital distributions, etc.

Read More

Determination of an NAV Error When the Net Asset Value Reported on the Financial Statements Differs From Published Values

Posted by admin on Jul 10, 2013 4:31:00 PM

For starters, the regulatory provisions relating to net asset value (“NAV”) can be found in the rules adopted under the Investment Company Act of 1940, in particular, Rules 2A-4 and 22c-1. A few notable excerpts from these two rules are as follows:

Read More

Consideration of Fair Value and International Securities

Posted by admin on Apr 12, 2013 6:23:44 PM

Long has the fair valuation of portfolio securities of investment companies been under scrutiny by regulators and auditors. Under the risk-based approach to auditing, fair valuation of investments remains one of the pillars for which effective auditing procedures are designed. In a 2001 letter to the Investment Company Institute, the Securities and Exchange Commission made the following comments in regard to fair valuation of portfolio securities:

Read More

To Defer or Not to Defer

Posted by admin on Oct 15, 2012 6:07:20 PM

The Regulated Investment Company (“RIC”) Modernization Act of 2010 (the “Act” or “RIC Mod”) brought an array of changes beneficial to RICs. Certain of these changes allow RICs more flexibility in electing whether or not to defer or to recognize in the current taxable year certain “late year losses.” Late year losses is a new term introduced into tax parlance by RIC Mod which encompasses all post-October net capital losses, losses on certain enumerated items of ordinary income (such as code section 988 foreign currency losses and the decline in value in an investment in a passive foreign investment company (“PFIC”)) and post-December ordinary losses not so enumerated.

Read More

PCAOB Issues New Standard for Auditor Communications With Audit Committees: What You Need To Know

Posted by admin on Sep 11, 2012 4:50:34 PM

Effective two-way communication between audit committees and external auditors is an integral part of the audit process. Such communications improve the ability of the audit committee to provide oversight and provide an opportunity for the auditors to discuss relevant matters with a forum other than management. These types of communications are essential to a high quality audit.

Read More

Contact Us