Supporting Statement A

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PAPERWORK REDUCTION ACT SUPPORTING STATEMENT
for the Revision of
Form N-1A
OMB Control Number 3235-0307

The U.S. Securities and Exchange Commission (“Commission” or “SEC”) submits this
information collection request (“ICR”) pursuant to the Paperwork Reduction Act of 1995 (“PRA”), 44
U.S.C. Section 3501 et seq., with the following justification.

1.

Necessity of Information Collection
Form N-1A (17 CFR 239.15A and 274.11A) is the form used by open-end management

investment companies (“funds”) to register under the Investment Company Act of 1940 (15 U.S.C. 80a1 et seq.) (“Investment Company Act”) and/or to register their securities under the Securities Act of
1933 (15 U.S.C. 77a, et seq.) (“Securities Act”). Section 5 of the Securities Act (15 U.S.C. 77e) requires
the filing of a registration statement prior to the offer of securities to the public and that the statement be
effective before any securities are sold, and Section 8 of the Investment Company Act (15 U.S.C. 80a-8)
requires a fund to register as an investment company. Form N-1A also permits funds to provide
investors with a prospectus and a statement of additional information (“SAI”) covering essential
information about the fund when it makes an initial or additional offering of its securities. Section 5(b)
of the Securities Act requires that investors be provided with a prospectus containing the information
required in a registration statement prior to the sale or at the time of confirmation or delivery of the
securities.
On September 30, 2026, the Commission issued a release that, among other things, would amend
certain investment company registration forms, including Form N-1A, to require funds to provide more
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particularized prospectus disclosure in two locations about any performance-based compensation paid to
the investment adviser:
•

Fee table: the proposal would add a distinct line item regarding any performance-based
compensation paid to the adviser or its affiliates, while also alerting the investor about the
variability of the performance fees and providing a cross-reference to the more complete
discussion about the performance fees provided later in the prospectus In addition, the
proposal would require that the expense example reflect any performance fees; and

•

Management discussion: the proposal would require a detailed description of the
performance fee arrangement, including a graphical representation illustrating the
calculation of the performance fee across a range of hypothetical performance scenarios.1

These proposed amendments are designed to help implement the proposal’s investor protection goals,
and would augment the current registration form requirements that require a fund to provide disclosure
in its prospectus and statement of additional information about the compensation of its investment
advisers, including performance-based compensation.

2.

Purpose and Use of Information Collection
The title for the collection of information is: Form N-1A under the Investment Company Act of

1940 and Securities Act of 1933, Registration Statement of Open-End Management Investment
Companies. The purpose of Form N-1A is to meet the filing and disclosure requirements of the
Securities Act and the Investment Company Act and to enable funds to provide investors with
information necessary to evaluate an investment in the fund. Unlike many other federal information
collections, which are primarily for the use and benefit of the collecting agency, this information
collection is primarily for the use and benefit of investors. The information filed with the Commission

1

Investment Adviser Performance-Based Compensation, Investment Advisers Act Release No. 7022 (Sept. 30, 2026)
[91 FR 63676 (Oct. 6, 2026)].

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also permits the verification of compliance with securities law requirements and assures the public
availability and dissemination of the information.

3.

Use and Consideration of Information Technology
The Commission’s electronic filing system (Electronic Data Gathering, Analysis and Retrieval or

“EDGAR”) is designed to automate the filing, processing and dissemination of full disclosure filings.
The system permits publicly held companies to transmit their filings to the Commission electronically.
EDGAR has increased the speed, accuracy and availability of information, generating benefits to
investors and financial markets. All funds have been required to use EDGAR for their disclosure filings
since November 6, 1995. Form N-1A is required to be filed with the Commission electronically on
EDGAR. 2 The public may access filings on EDGAR through the Commission’s website
(http://www.sec.gov).

4.

Identifying and Minimizing Duplication
The Commission periodically evaluates rule-based reporting and recordkeeping requirements for

duplication and reevaluates them whenever it proposes a rule or a change in a rule. The requirements of
Form N-1A are not generally duplicated elsewhere.

5.

Effect on Small Entities
The Commission reviews all rules periodically, as required by the Regulatory Flexibility Act, 3 to

identify methods to minimize recordkeeping or reporting requirements affecting small businesses. The
disclosure requirements for registration statements on Form N-1A do not distinguish between small
entities and other investment companies. The burden on smaller investment companies of preparing and
filing registration statements may be proportionately greater than for larger investment companies. This

2

17 CFR 232.101(a)(1)(i) and (iv).

3

5 U.S.C. 601 et seq.

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burden includes the cost of producing, printing, filing, and disseminating prospectuses. The Commission
believes, however, that imposing different requirements on smaller investment companies would not be
consistent with investor protection and the purposes of the registration statements.

6.

Consequences of Not Conducting Collection and Obstacles to Reducing
Burden
The purpose of Form N-1A is to meet the filing and disclosure requirements of the Securities Act

and the Investment Company Act and to enable filers to provide investors with information necessary to
evaluate an investment in the security. Less frequent filing would be inconsistent with the filing and
disclosure requirements of the Securities Act and the Investment Company Act. In addition, if the form
were to be filed less frequently, investors may not be provided with the information necessary to
evaluate an investment in the security.

7.

Inconsistencies with Guidelines in 5 CFR 1320.5(d)(2)
This collection is not inconsistent with 5 CFR 1320.5(d)(2).

8.

Public Comment and Consultations Outside the Agency
Before determining whether to adopt the proposed amendments to Form N-1A, the Commission

will receive and evaluate public comments on the proposal and its collection of information
requirements. Moreover, the Commission and the staff of the Division of Investment Management
participate in an ongoing dialogue with representatives of the investment company industry through
public conferences, meetings, and informal exchanges. These various forums provide the Commission
and staff with a means of ascertaining and acting upon the paperwork burdens that may confront the
industry.

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9.

Payment or Gift to Respondents
Not applicable.

10.

Assurance of Confidentiality and Privacy
No assurance of confidentiality was provided.

11.

Collection Questions of a Sensitive Nature
Not applicable.

12.

Estimated Time Burden and its Cost Equivalent
The following estimates of average burden hours and costs are made solely for purposes of the

Paperwork Reduction Act of 1995 4 and are not derived from a comprehensive or even representative
survey or study of the cost of Commission rules and forms. Compliance with the disclosure
requirements of Form N-1A is mandatory. Responses to the disclosure requirements will not be kept
confidential.
As of December 31, 2025, there were approximately 12,674 funds that file on Form N-1A. We
estimate that 5 percent of these funds would enter into an investment advisory contract with an
investment adviser that includes a performance-based compensation arrangement based on capital gains
or based on other measures. As a result, we estimate that 634 funds would be subject to the enhanced
disclosure regarding performance-based compensation paid to the investment adviser on Form N-1A.
The table below summarizes our PRA annual burden estimates associated with the amendments to Form
N-1A.

4

44 U.S.C. 3501 et seq.

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N-1A

PRA Table 1. Estimated Paperwork Burden Effects of the Proposed Amendments to Form

Annual Hours1

Total Monetized Burden
Hours2

6,340 hours

Total Annual Cost Burden3

$2,929,080

$2,453,580

Notes:
1 We estimate that the amendments would increase the annual hour burden for Form N-1A by 10 hours

per fund or 6,340 hours in aggregate (10 hours x 634 funds = 6,340 hours).

2 The total monetized burden hours are based on the total annual hours estimate times a $462 blended

wage rate (6,340 hours x $462 = $2,929,080). The $462 wage rate reflects current estimates of the blended
hourly rate for an accountant and auditor ($330), paralegal and legal assistant ($281), and attorney ($774) in the
securities industry (($330 + $281 + $774)/3 = $462).
3 The total annual cost burden is the cost of goods and services purchased to prepare and amend

registration statements on Form N-1A in connection with the proposed amendments, such as for the services of
independent auditors and outside counsel. The cost burden estimate is based upon the estimated wage rate of
$774/hour for an attorney in the securities industry multiplied by 5 hours of work (5 hours x $774 wage rate =
$3,870 per fund). 634 regulated funds x $3,870 = $2,453,580.

13.

Estimated Additional Cost Burden
Cost burden is the cost of goods and services purchased to prepare and amend registration

statements on Form N-1A, such as for the services of independent auditors and outside counsel. The cost
burden does not include the total monetized burden hours discussed in Item 12 above. Estimates are
based on the Commission’s experience with the filing of registration forms. We estimate that the total
annual external cost burden associated with the proposed amendments would be $2,453,580, as detailed
in Table 1 above. When the total estimated annual external cost burden associated with the proposed
amendments is added to the current external cost burden associated with Form N-1A, $143,540,098, as
set forth in the current collection of information “Form N-1A under the Investment Company Act of
1940 and Securities Act of 1933, Registration Statement of Open-End Management Investment

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Companies” (OMB Control No. 3235-0307), the total annual estimated external cost burden is
$145,993,678.

14.

Annual Cost to the Federal Government
The SEC is in the process of revising its methodologies to estimate annualized costs to the

Federal government for all its relevant collections of information. The SEC anticipates that future
extensions of this collection of information will reflect the revised methodologies.

15.

Reasons for Changes in Burden Estimates
As summarized in Table 1 above, the estimated annual hourly burden associated with Form N-

1A would increase by 6,340 hours. When the total estimated annual hourly burden associated with the
proposed amendments is added to the current estimated annual burden associated with Form N-1A,
1,787,043, as set forth in the current collection of information “Form N-1A under the Investment
Company Act of 1940 and Securities Act of 1933, registration statement of Open-End Management
Investment Companies” (OMB Control No. 3235-0307), the total estimated annual hourly burden would
increase to 1,793,383 hours. Further, the total estimated external cost burden would increase by
$2,453,580 from $143,540,098 to $145,993,678, as discussed in Item 13, above. These increases in the
burden estimates are due to the proposed requirements that funds provide more particularized prospectus
disclosure in two locations about any performance-based compensation paid to the investment adviser.
In addition, staff has revised how it calculates cost burdens for purposes of PRAs, which also results in
revisions to the estimated cost burdens. Finally, the increase in estimated external cost burden reflects an
increase in those external costs.
16.

Plans for Publishing Results
The results of any information collected will not be published.

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17.

Approval to Omit Display of OMB Expiration Date
We request authorization to omit the expiration date on the electronic version of the form for

design and IT project scheduling reasons. The OMB control number will be displayed.

18.

Exceptions to the Certification for Paperwork Reduction Act Submissions
The Commission is not seeking an exception to the certification statement.

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