SEC Enhances Reporting Requirements for Investment Funds

The Securities and Exchange Commission (SEC) has announced significant changes to reporting requirements for registered investment companies, aimed at improving transparency and oversight in the fund industry.

In a move that will triple the amount of data available to investors annually, the SEC has amended Form N-PORT reporting rules. Under the new regulations, funds will be required to file monthly reports within 30 days of each month-end, a substantial change from the current quarterly filing system with a 60-day deadline.

SEC Chair Gary Gensler emphasized the importance of this change, stating, "Reliable, accessible data benefits everyone. These amendments will benefit investors through greater transparency of funds' investment portfolios and improve the Commission's oversight of the asset management industry."

The amendments apply to a wide range of investment vehicles, including registered open-end funds, closed-end funds, and exchange-traded funds organized as unit investment trusts. This change is expected to provide more timely insights into funds' portfolio holdings and associated risks.

In addition to more frequent reporting, the SEC has also increased public access to this information. Monthly reports on Form N-PORT will now be made available to the public 60 days after the end of each month, instead of only every third month of a quarter.

The Commission has also adopted amendments to Form N-CEN, requiring open-end funds to report on service providers used in their liquidity risk management programs. This change aims to help the SEC track specific liquidity risk management practices within the industry.

To assist funds in navigating these new requirements, the SEC has provided guidance on certain aspects of open-end fund liquidity risk management program requirements.

The new regulations are set to take effect on November 17, 2025, with a compliance deadline of the same date for most funds. However, smaller fund groups with net assets under $1 billion will have until May 18, 2026, to comply with the Form N-PORT amendments.

These changes represent a significant step towards enhancing transparency in the investment fund industry, providing both regulators and investors with more frequent and detailed insights into fund operations and risk management practices.

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