15c board reporting where agents draft every 15(c) answer from its source and check it against last year — and the Fund Treasurer decides
Every 15(c) answer cited and checked against last year, ready 10 days before the deadline.
See one case, screen by screen ↓15c board reporting is the yearly work of answering the independent directors' request for the information they need to approve each fund's advisory and sub-advisory contracts under Section 15(c) of the Investment Company Act of 1940, and assembling the answers into the board book. 15(c) Board Reporting adds seven agents that split counsel's 15c questionnaire into fund-level questions, draft cited answers from the cost model, fund accounting, the peer report and prior minutes, and check every figure against last year's response. The Fund Treasurer approves each answer and the Fund Chief Legal Officer releases the book.
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15c board reporting starts when the independent directors' counsel sends the annual request letter. Section 15(c) of the Investment Company Act of 1940 makes it the directors' duty to request, and the adviser's duty to furnish, the information reasonably necessary to evaluate every advisory and sub-advisory contract. Fund administration copies last year's response into a tracking spreadsheet and assigns each request by email, and owners re-key figures from the cost-allocation model, the fee ledgers and the peer report into last year's Word file. The answers then go into a board book of thousands of pages, arranged by the Gartenberg factors.
Nobody owns the year-over-year comparison. A sentence carried forward — “the methodology is unchanged” — or a margin that moved without a word can reach the board, and the 15(c) record is the adviser's evidence if its fees are ever challenged under Section 36(b). The SEC has fined an adviser and its CFO/CCO because the profitability information given to the board did not match the cost-allocation method it described. Counsel's follow-ups come back by email and land in the book as loose supplements, and a late book leaves directors little time to read before they vote.
Estimated split for a 62-fund complex answering one request letter, by hand and with the solution. Steps overlap in practice.
Seven agents route, answer and check every 15(c) question against last year; the Treasurer approves, the CLO releases.
Quillfield Funds — 62 mutual funds, ETFs and interval funds in three trusts, $349 billion in fund assets — is renewing 62 advisory and 9 sub-advisory agreements. The response to counsel is due October 30; the board votes in person on December 8. Here is one morning of the 15(c) process, screen by screen, in the working solution.
Rebecca's Today screen opens on the cycle clock — letter received September 18, tranche 1 to counsel October 9, response due October 30, 10 days left — and four numbers: 860 of 1,140 answers approved, 189 waiting for her, 41 moved figures to explain, 3 of counsel's 12 follow-ups open. “Needs you” gives each item one next step. Beside it, under “Your agents overnight”, each agent reports what it did, with the page or row it relied on.
Consistency agent, 6:14 a.m.: “Compared every answer with the 2025 response: 41 flags in 5 causes. Q47 Core Bond carries a sentence from last year that is no longer true.”
Rebecca asks, “Why did Core Bond's margin rise?” The Profitability agent answers in the same thread: the margin rose from 31.2% to 38.6% (cost model row 14); 7.0 points come from memo CAM-2026-02, which moved shared trading and technology costs from assets to trade tickets on April 1 (p. 2); under the old method it would be 31.6%, and the other 0.4 points are asset growth. Every figure is a link, and the answer ends with one action: “Open question 47”.
Each answer on the screen carries its citations and a next step; the person decides.
Whitcombe & Arden LLP's 14-page request letter, dated September 16, arrived by email. The Request agent split its 74 numbered items into 110 requests and 1,140 fund-level questions, and matched each request to last year's letter: 88 carried, 13 changed and 9 new, with counsel's added words marked. It proposed a routing plan — 164 questions to the Profitability agent for Tom Whitaker, 248 to the Performance agent for Ana Ruiz, 500 to the Fees and scale agent for Kenji Mori, 228 to the Board Record agent for Lena Brandt — and waited.
Request agent: “I proposed the routing plan; nothing started until Sofia Marchetti approved it at 2:30 p.m.”
Each row shows the question number, the fund and ticker, the letter item, the agent answering it, its status and how many sources it cites. Queues cut 1,140 questions to For you (189), Flagged (41), Needs a person (23), Drafting (68) and Approved (860). On the right, the 2026 renewal book's spine — Nature and Quality, Performance, Fees and Expenses, Profitability, Economies of Scale, Fall-out Benefits — fills page by page as answers are approved. Profitability stands at 157 of 164.
Item 31(b) asks for each fund's profitability for the last two fiscal years, before and after distribution expenses, and a description of the cost-allocation methodology, “noting any change from the prior year”; the Request agent notes counsel added that last phrase this year. For Quillfield Core Bond Fund (QCBIX) the Profitability agent states a fiscal 2026 pre-tax margin of 38.6% against 31.2% — revenue $52.6M net of a $0.4M waiver, allocated costs $32.3M — and recomputes it under last year's method: 31.6%, at 96% confidence. The Consistency agent flags that the draft carried forward last year's sentence that the method was unchanged, and the Board Record agent finds the December 9, 2025 minutes asking to be told of any such change, fund by fund.
Profitability agent: “7.0 of the 7.4 points come from the method change.”
Rebecca clicks “p. 2” and the source opens beside the thread: memo CAM-2026-02, Quillfield Corporate Finance, April 14, 2026, approved by the Adviser's CFO, as a read-only copy. The passage the agent used is highlighted — from April 1, 2026, shared trading and technology costs are allocated by each fund's trade tickets rather than its average net assets — and section 3 says the change will be described to the Funds' Board in the 2026 contract review.
“The highlighted passage is what the agent used. The original file is kept unchanged with its fingerprint.”
Tom Whitaker, the preparer, accepted the agent's revised wording at 8:12 a.m.; signed in as Tom, the Approve and Reject buttons are locked. Rebecca opens the decision: the footnote the Profitability agent drafted for the book, citing the cost model scenario, memo p. 2 and minutes p. 7 — “Under the prior methodology the fiscal 2026 margin would have been 31.6%.” She keeps it, picks reason code A2, Approved with footnote, and signs as Fund Treasurer.
To the preparer: “You prepared this answer. The Fund Treasurer approves it: no one approves their own work.”
The Consistency agent groups its 41 flags by cause, so one document explains seven margins. The same memo moved Short Duration Income (30.6% → 34.1%), Intermediate Municipal (33.0% → 36.4%), Small Cap Growth (29.8% → 25.6%), International Small Cap (26.2% → 22.7%), Emerging Markets Equity (27.4% → 21.9%) and Core Bond ETF (24.1% → 28.0%). Rebecca ticks each answer as she reads its footnote, approves the six with one signature per answer, and signs off the section: 164 of 164, reason code S1, Section complete and reviewed.
Consistency agent: “I drafted the same footnote for each, with that fund's old-method margin. You still review and approve each one.”
In the 2026 contract renewal book — 2,860 pages, including 420 pages of exhibits and peer reports, arranged by Gartenberg factor — Profitability now reads 164/164, Signed. Core Bond's page 1,688 shows both fiscal years and the approved footnote, and the board's December 2025 commitment on cost-allocation changes shows answered. Signed in as the Treasurer, “Release to board portal” is locked: releasing is Marcus's alone, and the Book agent posts only what he releases.
Board commitment: “Identify any change in cost-allocation methodology before the 2026 review, fund by fund” — Q47 and 6 more answers.
After tranche 1, Eleanor Hartley sent 12 follow-ups; 3 are open, and FU-10 has already escalated. FU-11 asks about Hoshizora Asset Management's financial condition and any regulatory inspection. It landed on its question's thread, Q1079, Japan Equity Fund, due October 22. The Board Record agent drafted the reply from Hoshizora's Japanese business report and inspection notice — net assets of ¥18.6 billion against a ¥50 million minimum, an inspection closed February 13, 2026 with no material findings — with each original passage beside the English, at 94% confidence.
“Nothing reaches counsel until the Treasurer approves the reply.”
The same 15(c) renewal, seen by five of the people who carry it — what the cycle looked like, and what it looks like now.
Seven agents route, answer and check every 15(c) question against last year; the Treasurer approves, the CLO releases.
Reads counsel's 15(c) letter and any supplemental letter, expands each “for each Fund” request across the funds, matches it to last year's letter as carried, changed or new, and proposes an agent and an owner for every question.
Computes each fund's revenue, allocated costs and margin for two fiscal years, before and after distribution, under this year's and last year's cost method, and attributes every change — citing the cost-model row and the methodology memo.
Places each fund against its benchmark and peer universe for 1, 3, 5 and 10 years from signed-off returns and the current peer report edition, and drafts watch-list explanations and follow-up replies, citing the remediation plan for funds in the fourth or fifth quintile.
Compares each fund's fees with its expense group, states breakpoints and the effective fee rate, lists waivers expiring within 12 months and covers economies of scale and fall-out benefits — reading other-client and sub-adviser fee schedules in their own language and citing the page.
Searches board minutes since 2021, last year's response and the follow-ups, quotes the board's requests with page citations, and links each commitment to the answer that must honor it.
Compares every figure and statement with last year's response, its source system and every other place it appears in this year's book; flags moves beyond tolerance and contradictions, and groups flags by the document that explains them.
Assembles the renewal and quarterly board books by tab with footnotes and sources, paginates and cross-references them, threads counsel's follow-ups with a three-business-day clock and publishes released sections to the board portal.
Approve, sign, release. The agents propose; a named person decides.
Every screen carries its own conversation with the agent that owns it. Ask about a fund, a figure or a follow-up — or tell the agents what to do — and each answer cites its source and opens the screen where you act on it.
Why did Core Bond's margin rise?
Core Bond's margin rose from 31.2% to 38.6%. 7.0 points come from memo CAM-2026-02, which moved shared trading and technology costs from assets to trade tickets on April 1; under the old method the margin would be 31.6%. The other 0.4 points are asset growth.
What is the margin before distribution?
After distribution and servicing costs the Core Bond margin is 38.6%, because the cost model already allocates $5.0M of distribution to the Fund. Before distribution it is 48.1% ($52.6M revenue, $27.3M other costs). I have added both to the answer, as item 31(b) asks.
What is still open from counsel?
Three of counsel's 12 follow-ups are open: FU-10, Small Cap Growth's rank (due Oct 21); FU-11, Hoshizora's financial condition, drafted from its Japanese business report and waiting for you; and FU-12, artificial intelligence use, waiting for the CCO.
Draft a summary of the Profitability section for the board
Draft: “The Adviser's margin across the complex was 33.9% in fiscal 2026 against 34.4%. On April 1 the Adviser began allocating shared trading and technology costs by trade tickets; total costs were unchanged but moved between funds, so seven margins moved more than 2 points, each footnoted with its old-method figure, as the Board asked in December.” It is placed at the front of the Profitability tab as a draft for Rebecca to approve.
13 screens from the working solution, on its sample data. Pick one to see it large.
The tolerances the Consistency agent checks against, the clocks on counsel's follow-ups and the retention rules are settings. A change becomes a versioned change request: the administrator proposes, and the Fund Treasurer approves anything that affects an answer.
| Setting | Default | Choose from |
|---|---|---|
| Margin change | 2.0 points | A larger move with no explanation is flagged |
| Expense ratio change | 2 bps | Against last year's response and the source |
| Effective fee rate change | 1 bp | Against last year's response and the source |
| Net assets between tabs | $1 million or a different date | The same figure must match across the book |
| Peer quintile change | 1 step | Against last year's response and the peer report |
| Statement carried from last year | Any contradiction with a source | Flagged as “Contradicts last year” |
| Counsel's follow-ups | Answered in 3 business days | Escalate to the Head of Fund Administration on day 2, the Fund Treasurer on day 3 |
| Retention | 6 years, the first 2 readily accessible | US East with US West recovery · legal hold by the CLO |
Every figure is labelled: a target the solution is built to, an estimate, a typical published result, or a proven one.
“demo” = seen in the working solution, on its sample fund data · “target” = the design goal, measured in the live solution · “estimated” = our estimate · “typical” = published figures (Investment Company Act of 1940, Sections 15(a), 15(c) and 36(b); SEC, Kornitzer Capital Management, IC-31560, April 21, 2015 — $50,000 against the adviser and $25,000 against its CFO/CCO; Rule 31a-2, 17 CFR 270.31a-2, on keeping the materials six years; Jones v. Harris Associates, 559 U.S. 335, 2010). Context: Mutual Fund Directors Forum 15(c) white paper, Part 2, January 7, 2025. People, funds, firms and figures named on this page — including Quillfield Funds, Whitcombe & Arden LLP and Hoshizora Asset Management — are fictional: characters and sample data in the working solution.
15c board reporting is the yearly work of answering the independent directors' request for the information they need to approve each fund's advisory and sub-advisory contracts under Section 15(c) of the Investment Company Act of 1940, and assembling the answers into the board book. 15(c) Board Reporting adds seven agents that split counsel's 15c questionnaire into fund-level questions, draft cited answers from the cost model, fund accounting, the peer report and prior minutes, and check every figure against last year's response. The Fund Treasurer approves each answer and the Fund Chief Legal Officer releases the book.
Each year a majority of a fund's independent directors must approve its advisory and sub-advisory contracts, voting in person. Under Section 15(c) the directors request, and the adviser must furnish, the information reasonably necessary to evaluate them; in practice counsel sends a request letter, the adviser answers it fund by fund, and the answers go to the board in a book before the vote. In the demo that runs from counsel's letter on September 18 to the vote on December 8.
They are the factors from the Gartenberg case (2d Cir. 1982), which the Supreme Court endorsed in Jones v. Harris (2010): the nature, extent and quality of services, investment performance, fees and expenses compared with peers, the adviser's costs and profitability, economies of scale and fall-out benefits, with the directors' own independence and care also weighed. The board book here is arranged in six tabs on those lines, and each fills as its answers are approved.
The Request agent splits counsel's letter into requests and fund-level questions, matches each to last year's letter and proposes who answers it; the Head of Fund Administration approves the plan before anything runs. Agents draft each answer from the systems of record with citations, a preparer accepts or edits it, and the Fund Treasurer approves it. Each follow-up lands on its question's thread with a three-business-day clock, and nothing reaches counsel until the Treasurer approves the reply.
The Profitability agent states each fund's margin for two fiscal years, before and after distribution, and recomputes it under last year's method when the method changes — 7.0 of Core Bond's 7.4 points in the demo. The Consistency agent compares every figure and statement with last year's response, its source and the rest of the book, against tolerances such as 2.0 points for a margin or 2 bps for an expense ratio, and groups flags by cause. It never clears its own flag.
Rule 31a-2 requires the materials the board considered to be kept for at least six years, the first two in an easily accessible place. The solution keeps board materials and their sources for 6 years, the first 2 readily accessible, in the United States only, with a legal hold the Chief Legal Officer can place on any cycle.
Yes. Agents propose and never approve, release or clear their own flags. A preparer cannot approve their own answer, the Fund Treasurer approves each answer with a reason code and signs each section, and only the Fund Chief Legal Officer releases sections to the board portal. Every step is on a hash-chained audit trail.
The Agentic Solution Engine builds and deploys it from your requirements and documents — counsel's last request letter, last year's response, your cost-allocation method and your board book structure — and it goes live once every quality gate has passed. We will walk you through it on your own letter first.
Every peer fee your board sees, cited to the peer’s own fee table and signed.
1-min demoFund Launch ManagementFirst NAV on the planned date: every slip caught early, re-planned and signed off.
1-min demoFund RationalizationEvery subscale fund, each quarter: a cited case argued both ways, signed before the board.
1-min demoWe'll run 15(c) Board Reporting on your own request letter and last year's response.