US Code Title 15 Section 80a-31

CITE

    15 USC Sec. 80a-31                                          01/05/2009

EXPCITE

    TITLE 15 - COMMERCE AND TRADE
    CHAPTER 2D - INVESTMENT COMPANIES AND ADVISERS
    SUBCHAPTER I - INVESTMENT COMPANIES

HEAD

    Sec. 80a-31. Accountants and auditors

STATUTE

    (a) Selection of accountant
      It shall be unlawful for any registered management company or
    registered face-amount certificate company to file with the
    Commission any financial statement signed or certified by an
    independent public accountant, unless -
        (1) such accountant shall have been selected at a meeting held
      within thirty days before or after the beginning of the fiscal
      year or before the annual meeting of stockholders in that year by
      the vote, cast in person, of a majority of those members of the
      board of directors who are not interested persons of such
      registered company;
        (2) such selection shall have been submitted for ratification
      or rejection at the next succeeding annual meeting of
      stockholders if such meeting be held, except that any vacancy
      occurring between annual meetings, due to the death or
      resignation of the accountant, may be filled by the vote of a
      majority of those members of the board of directors who are not
      interested persons of such registered company, cast in person at
      a meeting called for the purpose of voting on such action;
        (3) the employment of such accountant shall have been
      conditioned upon the right of the company by vote of a majority
      of the outstanding voting securities at any meeting called for
      the purpose to terminate such employment forthwith without any
      penalty; and
        (4) such certificate or report of such accountant shall be
      addressed both to the board of directors of such registered
      company and to the security holders thereof.
    If the selection of an accountant has been rejected pursuant to
    paragraph (2) or his employment terminated pursuant to paragraph
    (3), the vacancy so occurring may be filled by a vote of a majority
    of the outstanding voting securities, either at the meeting at
    which the rejection or termination occurred or, if not so filled,
    at a subsequent meeting which shall be called for the purpose. In
    the case of a common-law trust of the character described in
    section 80a-16(c) of this title, no ratification of the employment
    of such accountant shall be required but such employment may be
    terminated and such accountant removed by action of the holders of
    record of a majority of the outstanding shares of beneficial
    interest in such trust in the same manner as is provided in section
    80a-16(c) of this title in respect of the removal of a trustee, and
    all the provisions therein contained as to the calling of a meeting
    shall be applicable. In the event of such termination and removal,
    the vacancy so occurring may be filled by action of the holders of
    record of a majority of the shares of beneficial interest either at
    the meeting, if any, at which such termination and removal occurs,
    or by instruments in writing filed with the custodian, or if not so
    filed within a reasonable time then at a subsequent meeting which
    shall be called by the trustees for the purpose. The provisions of
    paragraph (42) of section 80a-2(a) of this title as to a majority
    shall be applicable to the vote cast at any meeting of the
    shareholders of such a trust held pursuant to this subsection.
    (b) Selection of controller or other principal accounting officer
      No registered management company or registered face-amount
    certificate company shall file with the Commission any financial
    statement in the preparation of which the controller or other
    principal accounting officer or employee of such company
    participated, unless such controller, officer or employee was
    selected, either by vote of the holders of such company's voting
    securities at the last annual meeting of such security holders, or
    by the board of directors of such company.
    (c) Reports of accountants and auditors
      The Commission is authorized, by rules and regulations or order
    in the public interest or for the protection of investors, to
    require accountants and auditors to keep reports, work sheets, and
    other documents and papers relating to registered investment
    companies for such period or periods as the Commission may
    prescribe, and to make the same available for inspection by the
    Commission or any member or representative thereof.

SOURCE

    (Aug. 22, 1940, ch. 686, title I, Sec. 32, 54 Stat. 838; Pub. L. 91-
    547, Sec. 18, Dec. 14, 1970, 84 Stat. 1427; Pub. L. 94-29, Sec.
    28(4), June 4, 1975, 89 Stat. 165.)

AMENDMENTS

      1975 - Subsec. (a). Pub. L. 94-29 substituted "section 80a-16(c)
    of this title" for "section 80a-16(b) of this title".
      1970 - Subsec. (a). Pub. L. 91-547 struck out introductory text
    "After one year from the effective date of this subchapter," and
    substituted "It" for "it"; inserted "the vote, cast in person, of"
    before "a majority" and substituted "interested persons of" for
    "investment advisers of, or affiliated persons of an investment
    adviser of, or officers or employees of," in par. (1); inserted
    "the vote of a majority of those members of" before "the board of
    directors" and "who are not interested persons of such registered
    company, cast in person at a meeting called for the purpose of
    voting on such action" after "the board of directors" in par. (2);
    substituted period for colon in par. (4); and in text after par.
    (4), substituted "if not so filled," for "if not so filled then"
    and "if not so filed" for "if not so filled", and substituted
    reference to par. (42) for par. (40) of section 80a-2(a) of this
    title.
                     EFFECTIVE DATE OF 1975 AMENDMENT
      Amendment by Pub. L. 94-29 effective June 4, 1975, see section
    31(a) of Pub. L. 94-29, set out as a note under section 78b of this
    title.
                     EFFECTIVE DATE OF 1970 AMENDMENT
      Amendment by Pub. L. 91-547 effective on expiration of one year
    after Dec. 14, 1970, see section 30(1) of Pub. L. 91-547, set out
    as a note under section 80a-52 of this title.

TRANSFER OF FUNCTIONS

      For transfer of functions of Securities and Exchange Commission,
    with certain exceptions, to Chairman of such Commission, see Reorg.
    Plan No. 10 of 1950, Secs. 1, 2, eff. May 24, 1950, 15 F.R. 3175,
    64 Stat. 1265, set out under section 78d of this title.