Investment fund management reports provide investors with crucial information regarding their investments. They are consistent and easy to understand. They present information on performance in various ways (MTD) QTD, YTD, and YTD), and are often accompanied with risk analysis data, such as VaR or stress testing. As regulations are increasing, managers are required to document their risk processes in more detail than they have ever before.

Investors are interested in knowing what they are paying for their fund investment, and this is reflected in the growing demand for more specific information on fund fees. Some funds define management fee in a narrow sense, and only information and personal data protection include costs associated with choosing portfolio securities within the above list. Other funds have “unified” fees which cover a broad range of expenses, such as record keeping and administrative services, brokerage commissions and 12b-1 fees.

Many funds employ breakpoint contracts which allow the management fee to decreases at certain asset intervals dependent on the total assets of the fund. To analyze these contracts, investors should be aware of the management fee for each of those intervals. The GAO recommends that the Commission require the funds to disclose fee information on a per-share basis at the class level and also to disclose any fees paid out of the principal and not from the management fee.

The GAO has also suggested that the Investment Company Act require that independent directors (directors who are not a part of the management of the fund) constitute at least the majority of a fund board. This is to ensure that independent directors are able to effectively represent the interests of fund shareholders.