First, we note that while the Commission's proposal would amend certain recordkeeping rules for investment companies and investment advisers, there are other recordkeeping requirements under the Investment Company Act that are not addressed in the Commission's proposed rulemaking. Yet, neither rule is mentioned or otherwise reflected in the Commission's proposal. It is logical and appropriate for the Commission to apply consistent standards to all records maintained by funds. Second, the Institute notes that the Commission previously had proposed amendments to Rule 17Ad-7 under the Securities Exchange Act of 1934 to allow registered transfer agents to use micrographic or electronic storage media to produce and preserve required records. That proposal was never adopted, however.
Many funds have an affiliated transfer agent that performs recordkeeping functions for the funds.
Any such standards should be consistent with those for fund and adviser records. While not specifically related to electronic recordkeeping, the Institute has an additional recommendation that is relevant to the Commission's overall effort to update its recordkeeping requirements. As noted above, Rule 31a-3 recognizes that investment company records may be prepared or maintained by someone other than the person required to maintain and preserve them. To provide additional flexibility to investment advisers, we urge the Commission to take this opportunity to amend the advisers recordkeeping rules to give specific recognition to similar types of arrangements in that context. The Institute appreciates the opportunity to present its views on the Commission's proposal.