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How Tech Writers Can Help Investment Companies Develop Compliant Procedural Documentation 2

In 2004, the Security and Exchange Commission amended the Investment Company Act of 1940 to require investment companies to adopt and consistently review their written policies and procedures. These new rules were implemented in order to assure that investment companies would not violate federal securities laws. Investment companies can be in violation of the SEC if they fail to adopt written policies and procedures. The primary purpose of these rules is to ensure compliance of investment companies with SEC regulations. Protecting the interests of shareholders and investors is crucial. Creating a clear set of compliant procedural documentation also allows investment companies to efficiently review and amend their policies and procedures when needed. 

Failure to comply with these new rules can be detrimental to the functioning of an investment company. Similarly, employees may not have the necessary documentation they need to comply with regulations. Procedural documentation can provide employees with the know-how they need to avoid compliance violations. Otherwise you could rack up loads of private litigation fines and other penalties imposed by the SEC. It can be difficult and time-consuming for investment companies to develop written procedural documentation. However, technical documentation writers can be a crucial asset in assisting with this behemoth of a task. 

Investment Companies’ Policies and Procedures

The SEC provides a couple of critical areas for which investment companies must have procedural documentation for. This includes pricing of portfolio securities and fund shares, processing of fund shares, protection of nonpublic information, and a variety of other principal areas. However, SEC also noted that compliance procedural documentation would not be standardized amongst all investment companies. They recommend that these companies evaluate their operations, assess any areas of potential violations, and address them in written policies and procedures.

For instance, a smaller investment firm with fewer services or products may not need as extensive procedural documentation. However, a larger investment firm is more complex. For this reason, it is vital for investment companies to approach the task of developing this documentation as it applies to their particular company model. In efforts to save time and resources, investment companies can turn to technical documentation writers. Technical writers are extremely versatile. However, their strong point lies in being knowledgable about policies and procedures that are compliant with SEC regulations. 

Common Procedural Documentation Compliance Issues 

Among the most common violations of the Investment Company Act of 1940, the SEC’s Office of Compliance Inspections and Examinations (OCIE) often finds deficiencies in written procedural documentation. The OCIE further specified that investment companies’ written policies/ procedures were too general.

Encompassing and thorough written procedural documentation allows investment companies to ensure compliance with federal securities laws. In addition, it helps avoid potential private litigation, fines, and other penalties imposed by the SEC. More importantly, it helps avoid damaging reputations among clients. Although the SEC introduced the written policies and procedures requirement back in 2004, the SEC continues to note failures on behalf of investment companies in producing satisfactory documentation. Technical documentation writers can assist investment companies in assuring that their procedural documentation is clearly developed and up to SEC standards. 

How EDC Technical Writers Can Help Investment Companies 

To avoid compliance issues with the SEC and to obtain proper written policies and procedures, investment companies can turn to technical documentation writers. EDC’s technical writers have produced high-quality and compliant policy and procedure documentation for banks, software companies, and biomedical firms. Our technical documentation writers produce procedural documentation that is effective in following regulatory guidelines. This sort of documentation serves as a crucial tool in training new employees, and clearly outlining procedures compliant with government regulations. Comprehensive written policies and procedures are necessary for investment companies to retain good standing with the SEC and for employees to ensure that they are not in violation of federal securities laws. 

We have a team of consultants ready to produce a complete line of documentation. Perhaps you may only need a single technical writer for a brief project. Either way Essential Data’s Engagement Manager will lead the project from start to finish. At Essential Data Corporation, we guarantee the quality of our work. Contact us today to get started. (800) 221-0093 or

Written by Diana Guerra