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Tailored Shareholder Reports Overview

New SEC requirements will modernize regulatory communications for shareholders.

Beginning in 2024, open-end mutual funds and most ETFs will be required to send streamlined summary annual and semi-annual reports that are more concise and visually engaging. These new “Tailored Shareholder Reports” will replace the existing 30e-3 notices and the full shareholder reports. While the concept of streamlined reports may appeal to all, getting there is not without its complexities for the industry. Broadridge is here to help simplify every step.

On October 26, 2022, the SEC adopted a new rule that requires open-end mutual funds and most ETFs to send annual and semi-annual “tailored” summary shareholder reports to all shareholders. These new summary shareholder reports replace sending out 30e-3 notices and/or full shareholder reports. The SEC has provided for an 18-month transition period, so funds will need to transition from full reports and 30e-3 notices to Tailored Shareholder Reports in or about July 2024.

What it means for shareholders

The new summary disclosures are designed to help retail investors monitor their fund investments with greater ease and transparency. These streamlined reports will include simplified fee and expense information, performance, portfolio holdings and other key information investors use to monitor their funds. Ideally, these summaries will be 2-4 pages. More detailed information (such as financial statements) will be available to shareholders online in Form N-CSR, which is required to be filed with the SEC and delivered to shareholders upon request.

What it means for open-end funds and ETFs

The new requirements apply to Form N-1A registrants and have provisions for content, distribution, filing and website availability.

Getting to this point will require specific steps. For example:

  • A Tailored Shareholder Report will be required for each fund and share class.
  • The entire report must be tagged with iXBRL and filed on EDGAR.
  • Web-hosting requirements are more comprehensive. For example, online disclosures will need to be readable and printable with links between documents. They must also be available for download and provided free of charge.
  • Funds will be required to deliver additional disclosures, such as the Form N-CSR and Quarterly Fund Holdings for quarters 1 and 3, upon request.
  • The ruling also applies to underlying funds of variable products registered on form N1-A.

The tables below provide more details on the requirements for the Tailored Shareholder Report and Form N-CSR.

How Broadridge can help

Our regulatory communications team has actively monitored this rule since its initial proposal. We’re working with our clients to answer initial questions you may have today and are helping the financial services industry assess what it will take to implement these new requirements in the simplest, most effective and cost-efficient ways.

If interested, you can review the SEC press release, rule and fact sheet.

Over the coming weeks, we will provide more details on the specific requirements and practical advice on how you can turn these new requirements to your advantage.

If you have any questions, please contact us.

Tailored Shareholder Report: High-Level Requirements

Content Tailored Reports must include summary information on expenses, performance, holdings, key statistics, material changes and other summary information. Content must be in a required order and language must be in “plain English.”
Single Reports Reports may only include single funds (and the single share class owned by the investor).
Delivery Reports must be sent (paper or email with consent) within 60 days of a fund’s fiscal year-end.
SEC Filing Reports must be filed on Form N-CSR on Edgar by Day 70 and all information in the Tailored Shareholder Report must be tagged in iXBRL.
Web Hosting If a fund uses a summary prospectus, the Tailored Shareholder Report must be posted on its website.

Form N-CSR (Items 7-11) High-Level Requirements

Content Financial statement, financial highlights and other detailed information from the existing full shareholder reports.
Multi-Fund/Class May include multiple funds and classes.
SEC Filing Must be filed on SEC’s EDGAR website by Day 70. No iXBRL tagging requirement (Items 7-11).
Web Hosting Must be posted on the fund’s website within 60 days of the fund’s fiscal year end.
Delivery Must be delivered to shareholders upon request; sent within 3 business days free of charge.

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