Securities Lawyer's Deskbook                          published by The University of Cincinnati College of Law

Rule 31a-2 -- Records to Be Preserved by Registered Investment Companies, Certain Majority-Owned Subsidiaries Thereof, and Other Persons Having Transactions with Registered Investment Companies

---

1. Every registered investment company shall:
   
   
   1. Preserve permanently, the first two years in an easily accessible place, all books and records required to be made pursuant to paragraphs 1 through 4 of Rule 31a-1(b);
      
      
   2. Preserve for a period not less than six years from the end of the fiscal year in which any transactions occurred, the first two years in an easily accessible place, all books and records required to be made pursuant to paragraphs 5 through 12 or Rule 31a-1(b) and all vouchers, memoranda, correspondence, checkbooks, bank statements, cancelled checks, cash reconciliations, cancelled stock certificates, and all schedules evidencing and supporting each computation of net asset value of the investment company shares, and other documents required to be maintained by Rule 31a-1(a) and not enumerated in Rule 31a-1(b);
      
      
   3. Preserve for a period not less than 6 years from the end of the fiscal year last used, the first 2 years in an easily accessible place, any advertisement, pamphlet, circular, form letter or other sales literature addressed to or intended for distribution to prospective investors;
      
      
   4. Preserve for a period not less than six years, the first two years in an easily accessible place, any record of the initial determination that a director is not an interested person of the investment company, and each subsequent determination that the director is not an interested person of the investment company. These records must include any questionnaire and any other document used to determine that a director is not an interested person of the company;
      
      
   5. Preserve for a period not less than six years, the first two years in an easily accessible place, any materials used by the disinterested directors of an investment company to determine that a person who is acting as legal counsel to those directors is an independent legal counsel; and
      
      
   6. Preserve for a period not less than six years, the first two years in an easily accessible place, any documents or other written information considered by the directors of the investment company pursuant to section 15(c) of the Act in approving the terms or renewal of a contract or agreement between the company and an investment advisor.
   
   
   
2. Every underwriter, broker, or dealer which is a majority-owned subsidiary of a registered investment company shall preserve for the periods prescribed therein such accounts, books and other documents as are required to be preserved by brokers and dealers by rule adopted under section 17 of the Securities Exchange Act of 1934.
   
   
3. Every depositor of any registered investment company, and every principal underwriter for any registered investment company other than a closed-end company, shall preserve for a period of not less than six years such accounts, books and other documents as are required to be maintained by brokers and dealers by rule adopted under section 17 of the Securities Exchange Act of 1934, to the extent such records are necessary or appropriate to record such person's transactions with such registered investment company.
   
   
4. Every investment adviser which is a majority-owned subsidiary of a registered investment company shall preserve for the periods prescribed therein such accounts, books and other documents as are required to be preserved by investment advisers by rule adopted under section 204 of the Investment Advisers Act of 1940.
   
   
5. Every investment adviser not a majority-owned subsidiary of a registered investment company shall preserve for a period of not less than six years such accounts, books and other documents as are required to be maintained by registered investment advisers by rule adopted under section 204 of the Investment Advisers Act of 1940, to the extent such records are necessary or appropriate to record such person's transactions with such registered investment company.
   
   
6. Micrographic and electronic storage permitted.-
   
   
   1. General. The records required to be maintained and preserved under this part may be maintained and preserved for the required time by, or on behalf of, an investment company on:
      
      
      1. Micrographic media, including microfilm, microfiche, or any similar medium; or
         
         
      2. Electronic storage media, including any digital storage medium or system that meets the terms of this section.
         
         
   2. General requirements. The investment company, or person that maintains and preserves records on its behalf, must:
      
      
      1. Arrange and index the records in a way that permits easy location, access, and retrieval of any particular record;
         
         
      2. Provide promptly any of the following that the Commission (by its examiners or other representatives) or the directors of the company may request:
         
         
         1. A legible, true, and complete copy of the record in the medium and format in which it is stored;
            
            
         2. A legible, true, and complete printout of the record; and
            
            
         3. Means to access, view, and print the records; and
            
            
      3. Separately store, for the time required for preservation of the original record, a duplicate copy of the record on any medium allowed by this section.
         
         
   3. Special requirements for electronic storage media. In the case of records on electronic storage media, the investment company, or person that maintains and preserves records on its behalf, must establish and maintain procedures:
      
      
      1. To maintain and preserve the records, so as to reasonably safeguard them from loss, alteration, or destruction;
         
         
      2. To limit access to the records to properly authorized personnel, the directors of the investment company, and the Commission (including its examiners and other representatives); and
         
         
      3. To reasonably ensure that any reproduction of a non-electronic original record on electronic storage media is complete, true, and legible when retrieved.
         
         
   4. Notwithstanding the provisions of paragraphs (a) through (e) of this section, any record, book or other document may be destroyed in accordance with a plan previously submitted to and approved by the Commission. A plan shall be deemed to have been approved by the Commission if notice to the contrary has not been received within 90 days after submission of the plan to the Commission.

	Notice to Users: The Deskbook is made available with the understanding that the University of Cincinnati College of Law is not engaged in rendering legal, accounting or other professional services. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. See Terms and Conditions of Use.   © Copyright 1998-2011, University of Cincinnati, All Rights Reserved  Contact: ronald.jones@uc.edu