This chapter applies to:

1. (1)

   an authorised fund manager of an AUT or an ICVC;

2. (2)

   any other director of an ICVC;

3. (3)

   a depositary of an AUT or an ICVC; and

4. (4)

   an ICVC,

where such AUT or ICVC is a UCITS scheme or a non-UCITS retail scheme.

This section applies to an authorised fund manager, an ICVC and any other director of an ICVC

1. (1)

   A prospectus must be drawn up in English and published as a document by the authorised fund manager and, for an ICVC, it must be approved by the directors.

2. (2)

   The authorised fund manager must ensure that the prospectus:

   1. (a)

      contains the information required by COLL 4.2.5 R (Table: contents of the prospectus);

   2. (b)

      does not contain any provision which is unfairly prejudicial to the interests of unitholders generally or to the unitholders of any class of units;

   3. (c)

      does not contain any provision that conflicts with any rule in this sourcebook; and

   4. (d)

      is kept up-to-date and that revisions are made to it, whenever appropriate.

1. (1)

   An ICVC or the manager of an AUT must:

   1. (a)

      supply a copy of the scheme's most recent prospectus drawn up and published in accordance with COLL 4.2.2 R (Publishing the prospectus) free of charge to any person on request; and

   2. (b)

      file a copy of the scheme's original prospectus, together with all revisions thereto, with the FSA .

2. (2)

   An ICVC or the manager of an AUT which in either case is a UCITS scheme intending to market units in the territory of another EEA State must:

   1. (a)

      ensure that the following documents are drawn up in the, or one of the, official languages of the EEA State or a language approved by the Host State regulator:

      1. (i)

         the prospectus;

      2. (ii)

         the instrument constituting the scheme; and

      3. (iii)

         the latest annual and half-yearly long reports of the scheme;

   2. (b)

      supply copies of the most recent version of the documents in (a) to any purchaser of units free of charge on request, and

   3. (c)

      file copies of the most recent version of the documents in (a) with the competent authority of each such Host State, provided in the language, or one of the, languages of that State or a language approved by the competent authority of that State.

3. (3)

   An authorised fund manager must, upon the request of a unitholder in a UCITS scheme that it manages, provide information supplementary to the prospectus of that scheme relating to:

   1. (a)

      the quantitative limits applying to the risk management of that scheme;

   2. (b)

      the methods used in relation to (a); and

   3. (c)

      any recent development of the risk and yields of the main categories of investment.

1. (1)

   The authorised fund manager:

   1. (a)

      must ensure that the prospectus of the authorised fund does not contain any untrue or misleading statement or omit any matter required by the rules in this sourcebook to be included in it; and

   2. (b)

      is liable to pay compensation to any person who has acquired any units in the authorised fund and suffered loss in respect of them as a result of such statement or omission; this is in addition to any liability incurred apart from under this rule.

2. (2)

   The authorised fund manager is not in breach of (1)(a) and is not liable to pay compensation under (1)(b) if, at the time when the prospectus was made available to the public, it had taken reasonable care to determine that the statement was true and not misleading, or that the omission was appropriate, and that:

   1. (a)

      it continued to take such reasonable care until the time of the relevant acquisition of units in the scheme; or

   2. (b)

      the acquisition took place before it was reasonably practicable to bring a correction to the attention of potential purchasers; or

   3. (c)

      it had already taken all reasonable steps to ensure that a correction was brought to the attention of potential purchasers; or

   4. (d)

      the person who acquired the units was not materially influenced or affected by that statement or omission in making the decision to invest.

3. (3)

   The authorised fund manager is also not in breach of (1)(a) and is not liable to pay compensation under (1)(b) if:

   1. (a)

      before the acquisition a correction had been published in a manner calculated to bring it to the attention of persons likely to acquire the units in question; or

   2. (b)

      it took all reasonable steps to secure such publication and had reasonable grounds to conclude that publication had taken place before the units were acquired.

4. (4)

   The authorised fund manager is not liable to pay compensation under (1)(b) if the person who acquired the units knew at the time of the acquisition that the statement was untrue or misleading or knew of the omission.

5. (5)

   For the purposes of this rule a revised prospectus will be treated as a different prospectus from the original one.

6. (6)

   References in this rule to the acquisition of units include references to contracting to acquire them.

This section applies to an authorised fund manager.

1. (1)

   The authorised fund manager, must, by way of an extraordinary resolution, obtain prior approval from the unitholders for any proposed change to the scheme which, in accordance with (2), is a fundamental change.

2. (2)

   A fundamental change is a change or event which:

   1. (a)

      changes the purposes or nature of the scheme; or

   2. (b)

      may materially prejudice a unitholder; or

   3. (c)

      alters the risk profile of the scheme; or

   4. (d)

      introduces any new type of payment out of scheme property.

1. (1)

   The authorised fund manager must give prior written notice to unitholders, in respect of any proposed change to the operation of a scheme that, in accordance with (2), constitutes a significant change.

2. (2)

   A significant change is a change or event which is not fundamental in accordance with COLL 4.3.4 R but which:

   1. (a)

      affects a unitholder's ability to exercise his rights in relation to his investment; or

   2. (b)

      would reasonably be expected to cause the unitholder to reconsider his participation in the scheme; or

   3. (c)

      results in any increased payments out of the scheme property to an authorised fund manager or any other director of an ICVC or an associate of either; or

   4. (d)

      materially increases other types of payment out of scheme property.

3. (3)

   The notice period in (1) must be of a reasonable length (and must not be less than 60 days).

1. (1)

   The authorised fund manager must inform unitholders in an appropriate manner and timescale of any notifiable changes that are reasonably likely to affect, or have affected, the operation of the scheme.

2. (2)

   A notifiable change is a change or event, other than a fundamental change under COLL 4.3.4 R or a significant change under COLL 4.3.6 R, which a unitholder must be made aware of unless the authorised fund manager concludes that the change is insignificant.

This section applies to an authorised fund manager, a depositary and any other director of an ICVC.

1. (1)

   The authorised fund manager, the depositary or the other directors of an ICVC may convene a general meeting of unitholders at any time.

2. (2)

   The unitholders may request the convening of a general meeting by a requisition which must:

   1. (a)

      state the objects of the meeting;

   2. (b)

      be dated;

   3. (c)

      be signed by unitholders who, at that date, are registered as the unitholders of units representing not less than one-tenth in value (or such lower proportion stated in the instrument constituting the scheme ) of all of the units then in issue; and

   4. (d)

      be deposited at the head office of the ICVC or with the trustee.

3. (3)

   The authorised fund manager, the depositary or the other directors of an ICVC must on receipt of a requisition that complies with (2), immediately convene a general meeting of the authorised fund for a date no later than eight weeks after receipt of the requisition.

This section applies, unless the context otherwise requires, to class meetings by reference to the units of the class concerned and the unitholders and prices of such units.

1. (1)

   Unless a unit in the authorised fund is a participating security, in this section "unitholders" means unitholders as at a cut-off date selected by the authorised fund manager which is a reasonable time before notices of the relevant meeting are sent out.

2. (2)

   If any unit in the authorised fund is a participating security, a registered unitholder of such a unit is entitled to receive a notice of a meeting or a notice of an adjourned meeting under COLL 4.4.5 R (Notice of general meetings), if entered on the register at the close of business on a day to be determined by the authorised fund manager, which must not be more than 21 days before the notices of the meeting are sent out.

3. (3)

   For the purposes of (2), in COLL 4.4.6 R (Quorum) to COLL 4.4.11 R (Chairman, adjournments and minutes) "unitholders" in relation to those units means:

   1. (a)

      the persons entered on the register at a time to be determined by the authorised fund manager and stated in the notice of the meeting, which must not be more than 48 hours before the time fixed for the meeting; or

   2. (b)

      in the case of bearer units, unitholders of bearer units which were in issue at the time applicable under (a).

1. (1)

   Where the authorised fund manager, the depositary or the other directors of an ICVC decide to convene a general meeting of unitholders:

   1. (a)

      each unitholder must be given at least 14 days written notice, inclusive of the date on which the notice is first served and the day of the meeting; and

   2. (b)

      the notice must specify the place, day and hour of the meeting and the terms of the resolutions to be proposed and a copy of the notice must be sent to the depositary.

2. (2)

   The accidental omission to give notice to, or the non-receipt of notice by, any unitholder does not invalidate the proceedings at any meeting.

3. (3)

   Notice of an adjourned meeting of unitholders must be given to each unitholder, stating that while two unitholders present in person or proxy are required to constitute a quorum at the adjourned meeting, this may be reduced to one in accordance with COLL 4.4.6R (3), should two such unitholders not be present after a reasonable time of convening of the meeting.

4. (4)

   Paragraph (1)(a) does not apply to the notice of an adjourned meeting.

1. (1)

   The quorum required to conduct business at a meeting of unitholders is two unitholders, present in person or by proxy.

2. (2)

   If after a reasonable time from the time for the start of the meeting, a quorum is not present, the meeting:

   1. (a)

      if convened on the requisition of unitholders, must be dissolved; and

   2. (b)

      in any other case, must stand adjourned to:

      1. (i)

         a day and time which is seven or more days after the day and time of the meeting; and

      2. (ii)

         in the case of a physical meeting or a hybrid meeting, a place to be appointed by the chairman.

3. (3)

   If, at an adjourned meeting under (2)(b), a quorum is not present after a reasonable time from the time for the meeting, one person entitled to be counted in a quorum present at the meeting shall constitute a quorum.

1. (1)

   Except where an extraordinary resolution is specifically required or permitted, any resolution of unitholders is passed by a simple majority of the votes validly cast at a general meeting of unitholders.

2. (2)

   In the case of an equality of, or an absence of, votes cast, the chairman is entitled to a casting vote.

3. (3)

   Where a resolution (including an extraordinary resolution) is required to conduct business at a meeting of unitholders and every unitholder is prohibited under COLL 4.4.8R (4) from voting, it shall not be necessary to convene such a meeting and a resolution may, with the prior written agreement of the depositary to the process, instead be passed with the written consent of unitholders representing 50% or more, or for an extraordinary resolution 75% or more, of the units of the scheme in issue.1

1. (1)

   On a show of hands every unitholder who is present in person has one vote.

2. (2)

   On a poll:

   1. (a)

      votes may be given either personally or by proxy or in another manner permitted by the instrument constituting the scheme;

   2. (b)

      the voting rights for each unit must be the proportion of the voting rights attached to all of the units in issue that the price of the unit bears to the aggregate price or prices of all of the units in issue:

      1. (i)

         if any unit is a participating security, at the time determined under COLL 4.4.4R (2) (Special meaning of Unitholder in COLL 4.4);

      2. (ii)

         otherwise at the date specified in COLL 4.4.4R (1); and

   3. (c)

      a unitholder need not use all his votes or cast all his votes in the same way.

3. (3)

   For joint unitholders, the vote of the most senior who votes, whether in person or by proxy, must be accepted to the exclusion of the votes of the other joint unitholders. For this purpose seniority must be determined by the order in which the names stand in the register of unitholders.1

   1
4. (4)

   No director of the ICVC or the manager can be counted in the quorum of, and no such director or the manager nor any of their associates may vote at, any meeting of the authorised fund.

5. (5)

   The prohibition in (4) does not apply to any units held on behalf of, or jointly with, a person who, if himself the registered unitholder, would be entitled to vote and from whom the director, the manager or its associate have received voting instructions.

6. (6)

   For the purpose of this section, units held, or treated as held, by the authorised fund manager or any other director of the ICVC, must not, except as mentioned in (5), be regarded as being in issue.

1. (1)

   A resolution put to the vote of a general meeting must be determined on a show of hands unless a poll is (before or on the declaration of the result of the show of hands) demanded by:

   1. (a)

      the chairman;

   2. (b)

      at least two unitholders; or

   3. (c)

      the depositary.

2. (2)

   Unless a poll is demanded in accordance with (1), a declaration by the chairman as to the result of a resolution is conclusive evidence of the fact.

1. (1)

   A unitholder may appoint another person to attend a general meeting and vote in his place.

2. (2)

   Unless the instrument constituting the scheme provides otherwise, a unitholder may appoint more than one proxy to attend on the same occasion but a proxy may vote only on a poll.

3. (3)

   Every notice calling a meeting of a scheme must contain a reasonably prominent statement that a unitholder entitled to attend and vote may appoint a proxy.

4. (4)

   For the appointment to be effective, any document relating to the appointment of a proxy must not be required to be received by the ICVC or any other person more than 48 hours before the meeting or adjourned meeting

1. (1)

   A meeting of unitholders must have a chairman, nominated:1

   1
   1. (a)

      in the case of an AUT, by the trustee; 1

   2. (b)

      in the case of an ICVC, by a director other than the ACD or an associate of the ACD or, if no such nomination is made, by the depositary.1

2. (2)

   If the chairman is not present after a reasonable time from the time for the meeting, the unitholders present must choose one of them to be chairman.

3. (3)

   The chairman:

   1. (a)

      may, with the consent of any meeting of unitholders at which a quorum is present; and

   2. (b)

      must, if so directed by the meeting;

      adjourn the meeting from time to time and from place to place

4. (4)

   Business must not be transacted at any adjourned meeting, except business which might have lawfully been transacted at the original meeting.

5. (5)

   The authorised fund manager must ensure that:

   1. (a)

      minutes of all resolutions and proceedings at every meeting of unitholders are made and kept; and

   2. (b)

      any minute made in (a) is signed by the chairman of the meeting of unitholders.

6. (6)

   Any minute referred to in (5)(b) is conclusive evidence of the matters stated in it.

1. (1)

   Where this sourcebook requires any notice or document to be served upon a unitholder, it is duly served :

   1. (a)

      for units held by a registered unitholder, if it is:

      1. (i)

         sent by post to or left at1 the unitholder's address as appearing in the register; or

         1
      2. (ii)

         sent1 by using an electronic medium in accordance with COLL 4.4.13 R (Other notices); or

         1
   2. (b)

      for units represented by bearer certificates, if given in the manner provided for in the prospectus.

2. (2)

   Any notice or document served by post is deemed to have been served on the second business day following the day on which it is posted.

3. (3)

   Any document left at a registered address or delivered other than by post is deemed to have been served on that day.

1. (1)

   Any document or notice to be served on or information to be given to, any person, including the FSA , must be in legible form.

2. (2)

   For the purposes of this rule, any form is legible form which:

   1. (a)

      is consistent with the ICVC's, the directors', the authorised fund manager's or the depositary's knowledge of how the recipient of the document wishes or expects to receive the document;

   2. (b)

      is capable of being provided in hard copy by the authorised fund manager, the depositary or any other director of the ICVC;

   3. (c)

      enables the recipient to know or record the time of receipt; and

   4. (d)

      is reasonable in the context.

3. (3)

   In this sourcebook, any requirement that a document be signed may be satisfied by an electronic signature or electronic evidence of assent.

The rules and guidance in this section apply to an authorised fund manager, a depositary and any other director of an ICVC.

1. (1)

   The authorised fund manager must for each annual accounting period and half-yearly accounting period, prepare a short report and a long report for a scheme.

2. (2)

   For a scheme which is an umbrella, the authorised fund manager must prepare a short report for each sub-fund but this is not necessary for the umbrella as a whole.

3. (3)

   Where the first annual accounting period of a scheme is less than 12 months, a half-yearly report need not be prepared.

4. (4)

   [deleted]1

1. (1)

   The short report for an authorised fund, or for a scheme which is an umbrella, its sub-fund, must contain for the relevant period:

   1. (a)

      the name of the scheme or sub-fund, its stated investment objectives and policy for achieving those objectives, a brief assessment of its risk profile and the name and address of the authorised fund manager;

   2. (b)

      a review of the scheme or sub-fund's investment activities and investment performance during the period;

   3. (c)

      a performance record consistent with COLL 4.5.10R (1) (Comparative table) so as to enable a unitholder to put into context the results of the investment activities of the scheme during the period;

   4. (d)

      sufficient information to enable unitholders to form a view on where the portfolio is invested at the end of the period and the extent to which that has changed over the period;

   5. (e)

      any other significant information which would reasonably enable unitholders to make an informed judgement on the activities of the scheme or sub-fund during the period and the results of those activities at the end of the period; and

   6. (f)

      a statement that the latest long report is available on request.

2. (2)

   The authorised fund manager must take reasonable steps to ensure that the short report is structured and written in such a way that it can be easily understood by the average investor.

3. (3)

   The short report must form a separate stand-alone document which must not include any extraneous material.

4. (4)

   The inclusion in a single document of the short reports of more than one of an authorised fund manager's schemes with the same accounting periods, or of more than one sub-fund in an umbrella, is not a contravention of (3) if each such report is discrete and easily identifiable.

5. (5)

   The authorised fund manager must ensure that the information given in the short report is consistent with the long report for the relevant accounting period prepared under COLL 4.5.7 R (Contents of the annual long report) or COLL 4.5.8 R(Contents of the half-yearly long report).

1. (1)

   An annual long report on an authorised fund, other than a scheme which is an umbrella, must contain:

   1. (a)

      the fullaccounts for the annual accounting period which must be prepared in accordance with the requirements of the IMA SORP;

   2. (b)

      the report of the authorised fund manager in accordance with COLL 4.5.9 R (Authorised fund manager's report);

   3. (c)

      the comparative table in accordance with COLL 4.5.10 R (Comparative table);

   4. (d)

      the report of the depositary in accordance with COLL 4.5.11 R (Report of the depositary); and

   5. (e)

      the report of the auditor in accordance with COLL 4.5.12 R (Report of the auditor).

2. (2)

   An annual long report on a scheme which is an umbrella must be prepared for the umbrella as a whole and2 must contain:

   1. (a)

      for each sub-fund:

      1. (i)

         the full accounts for the annual accounting period which must be prepared in accordance with the requirements of the IMA SORP;

      2. (ii)

         the report of the authorised fund manager in accordance with COLL 4.5.9 R; and

      3. (iii)

         the comparative table in accordance with COLL 4.5.10 R;

   2. (b)

      the aggregation of the accounts required by (a)(i) for each sub-fund;

   3. (c)

      the report of the depositary in accordance with COLL 4.5.11 R; and

   4. (d)

      the report of the auditor in accordance with COLL 4.5.12 R.

3. (3)

   The directors of an ICVC or the manager of an AUT must ensure that the accounts referred to in (1)(a),2 (2)(a) and (4)(a)2 give a true and fair view of the net income and the net gains and thelosses on the scheme property of the authorised fund, or, in the case of (2)(a) and (4)(a)2, the sub-fund, for the annual accounting period in question and the financial position of the authorised fund or sub-fund as at the end of that period.

   2
4. (4)

   The authorised fund manager of a scheme which is an umbrella may, in addition to complying with (2), prepare a further annual long report for any one or more individual sub-funds of the scheme, in which case it must contain:2

   1. (a)

      in relation to the sub-fund:2

      1. (i)

         the fullaccounts for the annual accounting period which must be prepared in accordance with the requirements of the IMA SORP;2

      2. (ii)

         the report of the authorised fund manager in accordance with COLL 4.5.9 R; and2

      3. (iii)

         the comparative table in accordance with COLL 4.5.10 R;2

   2. (b)

      the report of the depositary in accordance with COLL 4.5.11 R; and2

   3. (c)

      the report of the auditor in accordance with COLL 4.5.12 R.2

1. (1)

   A half-yearly long report on an authorised fund, other than for a scheme which is an umbrella, must contain:

   1. (a)

      the fullaccounts for the half-yearly accounting period which must be prepared in accordance with the requirements of the IMA SORP; and

   2. (b)

      the report of the authorised fund manager in accordance with COLL 4.5.9 R (Authorised fund manager's report).

2. (2)

   A half-yearly long report on a scheme which is an umbrella must be prepared for the umbrella as a whole and2 must contain:

   1. (a)

      for each sub-fund:

      1. (i)

         the 2full accounts for the half-yearly accounting period2 which must be prepared in accordance with the requirements of the IMA SORP; and

         2
      2. (ii)

         the report of the authorised fund manager in accordance with COLL 4.5.9 R; and

   2. (b)

      the aggregation of the accounts in (a)(i) for each sub-fund.

3. (3)

   The authorised fund manager of a scheme which is an umbrella may, in addition to complying with (2), prepare a further half-yearly long report for any one or more individual sub-funds of the scheme. Such reports must contain the full

   accounts and the report of the authorised fund manager that would be required by (1) if the sub-fund were a separate authorised fund.2

The matters set out in (1) to (13)2 must be included in any authorised fund manager's report, except where otherwise indicated:

1. (1)

   the names and addresses of :

   1. (a)

      the authorised fund manager;

   2. (b)

      the depositary;

   3. (c)

      the registrar;

   4. (d)

      any investment adviser;

   5. (e)

      the auditor; and

   6. (f)

      for a scheme which invests in immovables, the standing independent valuer;

2. (2)

   (for an ICVC), the names of any directors other than the ACD;

3. (3)

   a statement of the authorised status of the scheme;

4. (4)

   (for an ICVC) a statement that the unitholders of the ICVC are not liable for the debts of the ICVC;

5. (5)

   the investment objectives of the authorised fund;

6. (6)

   the policy

   for achieving those objectives;

7. (7)

   a review of the investment activities during the period to which the report relates;

8. (8)

   particulars of any fundamental changes in accordance with COLL 4.3.4 R (Fundamental change requiring prior approval by meeting) made since the date of the last report;

9. (9)

   particulars of any significant changes which have occurred in accordance with COLL 4.3.6 R (Significant change requiring pre-event notification) since the date of the last report;

10. (10)

    any other information which would enable unitholders to make an informed judgement on the development of the activities of the authorised fund during this period and the results of those activities as at the end of that period;

11. (11)

    for a report on an umbrella prepared in accordance with COLL 4.5.7R (2)2 or COLL 4.5.8R (2)2 :

    22
    1. (a)

       (for an ICVC), 2a statement to the effect that, as a sub-fund is not a legal entity, if the assets attributable to any sub-fund were insufficient to meet the liabilities attributable to it, the shortfall might have to be met out of the assets attributable to one or more other sub-funds of the ICVC; and

    2. (b)

       information required by (1) to (10) must be given for each sub-fund, if it would vary from that given in respect of the umbrella as a whole;

       2
12. (12)

    for a UCITS scheme which invests a substantial proportion of its assets in other schemes, a statement as to the maximum proportion of management fees charged to the scheme itself and to other schemes in which that scheme invests; and2

    2
13. (13)

    for a report on an individual sub-fund of a scheme which is an umbrella prepared in accordance with COLL 4.5.7R (4) or COLL 4.5.8R (3): 2

    1. (a)

       (for an ICVC) a statement corresponding to that required by (11)(a) making it clear that if the liability relates to another sub-fund of the umbrella, the shortfall or any part of it might have to be met out of the assets of the sub-fund to which the report relates; and2

    2. (b)

       a statement that the latest long report prepared for the umbrella as a whole is available on request.2

The comparative table required by COLL 4.5.7R (1)(c) (Contents of the annual long report) must set out:

1. (1)

   a performance record over the last five calendar years, or if the authorised fund has not been in existence during the whole of that period, over the whole period in which it has been in existence, showing:

   1. (a)

      the highest and the lowest price of a unit of each class in issue during each of those years; and

   2. (b)

      the net income distributed (or, for accumulation units, allocated) for a unit of each class in issue during each of those years, taking account of any sub-division or consolidation of units that occurred during that period;

2. (2)

   as at the end of each of the last three annual accounting periods (or all of the authorised fund's annual accounting periods, if less than three):

   1. (a)

      the total net asset value of the scheme property at the end of each of those years;

   2. (b)

      the net asset value per unit of each class; and

   3. (c)
      1. (i)

         (for a report of the directors of an ICVC) the number of units of each class in issue; or

      2. (ii)

         (for a report of the manager of an AUT) the number of units of each class in existence or treated as in existence; and

3. (3)

   if, in the period covered by the table:

   1. (a)

      the authorised fund has been the subject of any event (such as a scheme of arrangement) having a material effect on the size of the authorised fund, but excluding any issue or cancellation of units for cash; or

   2. (b)

      there have been changes in the investment objectives of the authorised fund;

   3. (c)

      an indication, related in the body of the table to the relevant year in the table, of the date of the event or change in the investment objectives and a brief description of its nature.

1. (1)

   The depositary must make an annual report to unitholders which must be included in the annual report.

2. (2)

   The annual report must contain:

   1. (a)

      a description, which may be in summary form, of the duties of the depositary under COLL 6.6.4 (General duties of the depositary) and in respect of the safekeeping of the scheme property; and

   2. (b)

      a statement whether, in any material respect:

      1. (i)

         the issue, sale, redemption and cancellation, and calculation of the price of the units and the application of the authorised fund's income

         , have not been carried out in accordance with the rules in this sourcebook and, where applicable, the OEIC Regulations and the instrument constituting the scheme; and

      2. (ii)

         the investment and borrowing powers and restrictions applicable to the authorised fund have been exceeded.

The authorised fund manager must ensure that the report of the auditor to the unitholders must include a statement:

1. (1)

   whether, in the auditor's opinion, the accounts have been properly prepared in accordance with the IMA SORP, the rules in this sourcebook, and the instrument constituting the scheme;

2. (2)

   whether, in the auditor's opinion, the accounts give a true and fair view of the net incomeand the net gains or losses ofthe scheme property of the authorised fund (or, as the case may be, the scheme property attributable to the sub-fund) for the annual accounting period in question and the financial position of the authorised fund or sub-fund as at the end of that period;

3. (3)

   whether the auditor is of the opinion that proper accounting records for the authorised fund (or, as the case may be, sub-fund) have not been kept or whether the accounts are not in agreement with those records;

4. (4)

   whether the auditor has been given all the information and explanations which, to the best of his knowledge and belief, are necessary for the purposes of his audit; and

5. (5)

   whether the auditor is of the opinion that the information given in the report of the directors or in the report of the authorised fund manager for that period is consistent with the accounts.

1. (1)

   The authorised fund manager must, within four months after the end of each annual accounting period and within two months after the end of each half-yearly accounting period, respectively provide free of charge the short report in accordance with (2).

2. (2)

   The authorised fund manager must send a copy of the report:

   1. (a)

      to each unitholder (or to the first named of joint unitholders) entered in or entitled to be entered in the register at the close of business on the last day of the relevant accounting period;

      2
   2. (b)

      to each unitholder of bearer units at his request; and2

      2
   3. (c)

      to any other person free of charge on request.2

3. (3)

   unitholders in a scheme which is an umbrella must be provided with a report relating to the particular sub-fund in which they hold units subject to providing the long report on the umbrella on request in accordance with COLL 4.5.14R (2)(a).

1. (1)

   The authorised fund manager must, within four months after the end of each annual accounting period and two months after the end of each half-yearly accounting period respectively, make available and publish the long reports2 prepared in accordance with COLL 4.5.7R (1) to (3)2 (Contents of the annual long report) and COLL 4.5.8R (1) to (2)2 (Contents of the half-yearly long report).

   22
2. (2)

   The reports referred to in (1) must:

   1. (a)

      be supplied free of charge to any person on request2;

      2
   2. (b)

      be available in English, for inspection by the public free of charge during ordinary office hours at a place specified;

   3. (c)

      for a UCITS scheme, be available for inspection by the public at a place designated by the authorised fund manager in each EEA State other than the United Kingdom in which units in the authorised fund are marketed, in English and in at least one of that other EEA State's official languages; and

   4. (d)

      be sent to the FSA .