For Immediate Release: Friday 16 May 2003

IMA CONSULTS ON AN UPDATED AND COMBINED STATEMENT OF RECOMMENDED PRACTICE (SORP) FOR AUTHORISED FUNDS

IMA, the new SORP¹ making body for authorised funds, invites comment on its exposure draft of an updated and combined SORP for authorised unit trusts and open-ended investment companies (OEICs). The deadline for responses is 18 August 2003. IMA will take account of any feedback and intends the new SORP to take effect for accounting periods beginning on or after 1 October 2003.

In drawing up the new SORP, the IMA’s SORP Working Group has considered all existing standards. The exposure draft does not pre-empt the UK’s adoption of International Financial Reporting Standards (IFRS) but the Group is committed to reviewing the SORP and the impact of IFRS on a regular basis.

IMA’s consultation paper proposes, in particular, changes to:

• the disclosure of derivatives;

• the presentation of the portfolio statement; and

• accounting for securities issued at a premium.

Julie Patterson, Director of Regulation and Taxation, commented:

“The two existing SORPs were well overdue for review and combining them is a sensible move. The Association believes that the exposure draft provides the industry with a solid foundation ready for the implementation of IFRS.”

A copy of the invitation to comment and the exposure draft is attached.

- Ends -

Attachment 1 - Invitation to Comment

Attachment 2 - SORP Exposure Draft

For further information please contact:

Julie Patterson, Director Regulation and Taxation, IMA, 020 7831 0898

Nathan Hall, Secretary to IMA’s SORP Working Group, IMA, 020 7831 0898

Helen Stephenson, Communications Officer, IMA, 020 7831 0898

Notes to Editors:

1. SORPs recommend accounting practice for financial statements and cannot override accounting standards. However, where choices are available they can recommend particular accounting treatments with the aim of narrowing differences between comparable entities. It is expected that the draft SORP will supersede the two existing SORPS for authorised unit trusts and OEICs.

2. An EU Regulation requires all listed companies to adopt IFRS from 1 January 2005. The impact on funds is not yet clear.

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