Round to Cents, Not Dollars, in New Fund Expense Example
The SEC recently adopted a technical amendment requiring mutual funds to round all figures in the new table of expense examples in fund shareholder reports to the nearest cent, instead of the nearest dollar.
As originally proposed, the expense example would have been based on a $10,000 investment and would have required rounding to the nearest dollar. At commentersí requests, the SEC lowered the $10,000 to $1,000 in its final rules, adopted March 2004. However, by its own admission, the agency didnít consider the impact that dollar rounding would have on the smaller amount: Dollar rounding would tend to disproportionately affect funds with relatively low expense ratios.
Hence the technical amendment.