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SEC Questions Auditor Independence

In a recent filing, Invesco disclosed that PwC was in “discussions” with the SEC over a rule interpretation that may affect its independence with respect to certain funds advised by Invesco.  At issue is PwC’s interpretation of the “loan rule,” which generally prohibits “[a]ny loan (including any margin loan) to or from an audit client, or an audit client's officers, directors, or record or beneficial owners of more than ten percent of the audit client's equity securities.”  According to the filing, as a result of “the SEC Staff’s interpretation of the Loan Rule, some of PwC’s relationships with lenders who own shares of certain closed-end and open-end funds within the Invesco investment company complex may be in violation of the Loan Rule, calling into question PwC’s independence with respect to such funds, such funds investment advisers and affiliated entities of such investment advisers, including the Company.”

Join the Forum and Bob Plaze, a partner at the Stroock law firm, on Thursday, June 9 for a webinar that will outline the issue, provide an overview of the effects of a finding by the SEC that an auditor is not independent, and discuss what, if anything, fund directors should do in response.

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