On November 2, 2010, the SEC sent a letter to the Mutual Fund Directors Forum and the Investment Company Institute's Independent Directors Council regarding fund directors’ responsibilities to make determinations under Rules 10f-3, 17a-7 and 17e-1 under the Investment Company Act of 1940.

Rules 10f-3, 17a-7 and 17e-1 each require a fund board to make a determination, no less frequently than quarterly, that each transaction made during the preceding quarter was effected in compliance with procedures reasonably designed to provide that the transactions comply with the requirements of the relevant rule. The SEC determined that some fund boards delegate their responsibility to make the determinations required under these rules, particularly in light of the subsequent adoption by the Commission in 2003 of Rule 38a-1 under the Act  (the compliance rule).   The SEC's letter makes clear that the Commission's staff interprets rules 10f-3, 17a-7 and 17e-1 as not permitting a fund board's determinations under each of these rules to be delegated.