A 4624 --- July 18, 1997
P & S 4200

TO: ALL PARTICIPANTS

ATTENTION: MANAGER MUTUAL FUNDS OPERATIONS, MANAGER DATA PROCESSING, MANAGER P&S DEPARTMENT, CASHIER

SUBJECT: MUTUAL FUND PROFILE SERVICE DAILY PRICE AND RATE FACILITY ENHANCEMENTS

National Securities Clearing Corporation (NSCC) implemented the Daily Price and Rate Facility of the Mutual Fund Profile Service (MFPS) in 1996 to provide mutual fund participants with an automated, centralized and standardized method to exchange daily prices and dividend rates for mutual funds. In an effort to enhance the services offered to benefit our participants, NSCC will supplement the existing ISO/SWIFT compatible data input and output formats with new fixed and variable length record formats similar to those used in other mutual fund services. These new formats will be implemented in two stages. New formats for OUTPUT of Daily Price and Rate data for BATCH participants are available for testing as of July 21, 1997. These formats will be implemented and available for production on August 8, 1997. The second implementation will include new INPUT formats for BATCH participants, and INPUT and OUTPUT formats for INTERACTIVE participants. A separate notice will be distributed with details on this implementation, currently scheduled for testing in mid-August, and actual implementation in early September.

Information is transmitted between NSCC and participants via mainframe and/or PC interfaces, using single batch or multi-batch formats. These enhancements will enable participants to select the output format consistent with their preferences, needs and capabilities to obtain price and rate data.

I. Benefits
The Price and Rate Facility of the Mutual Fund Profile Service enables NSCC participants to distribute and receive up-to-date information on mutual fund daily prices and rates in their choice of format. Data is communicated to NSCC by the funds and NASD, and distributed to recipients in a timely manner to support and expedite mutual fund transaction processing for all entities involved.

II. System Requirements and Functionality

A. Daily Price and Rate Functionality

The Daily Price and Rate facility contains data obtained from two sources. Fund participants provide actual prices and rates for individual securities for a specific date. This file also reports the number of days for which a daily dividend rate applies and any corrections to data previously transmitted. Daily prices are also obtained from the NASD and made available to participants.

Funds generally transmit daily prices and rates to NSCC as soon as information is available, preferably using a multi-batch or interactive communications format. The timeliness of this data is critical to facilitate daily processing by the recipients. NSCC distributes all information for securities received in single or multi-cycle formats for that day.

B. Historical Data

NSCC will maintain historical daily price and rate data within the database for a period of 90 days. NASD price information will be maintained for 30 days.

C. Data Corrections

Submitting participants can make corrections to prices and rates maintained in the Mutual Fund Profile using the appropriate data keys and indicators. All transmittal records include an indicator intended to identify data contained in that record as a correction to existing data currently in the database.

These corrections may require some form of corrective processing to be initiated by the recipient based on previous processing that might have occurred upon original receipt of such price and rate information.

D. Output Requirements

1. Composition of Data
NSCC consolidates all price and rate information received from submitting participants on a given day for distribution to receiving participants. Indication is not provided to receiving or submitting participants for prices and/or rates not received, and therefore, not transmitted by NSCC on a given day. An additional file which contains prices received from NASD for the current day is also available. Daily accrual rates and price corrections are not included with the information from NASD.

Output is now available to multi and single batch participants from NSCC in both fixed length and variable length non-ISO formats in addition to the existing ISO/SWIFT compatible formats. NASD prices are also now available in both formats.

2. System Availability
Output is available to recipients every two hours between 6:00 am and 4:00 pm, again at 5:00 pm, and then every half hour until 8:00 pm with a final output at 9:00 pm. Single-cycle output participants will receive a complete file, including all data received that day, at 9:00 pm daily (Monday - Friday). The file which contains daily prices received from NASD will be made available by NSCC to participants at approximately 6:45 pm. The system is normally available five days per week (Monday - Friday). Please refer to Appendix A for the MFPS - Price and Rate Input/Output Schedule.

3. Output to Service Bureaus
In order to increase efficiency, service bureaus acting on the behalf of multiple clients, will receive only one file from NSCC in each output cycle containing comprehensive daily price and rate information designated for all Mutual Fund Profile participants utilizing that vendor. Service Bureaus have the obligation to insure that information is provided only to those clients participating in the service.

III. Implementation Requirements

A. Data Integrity/Processing

To insure the integrity of the data included in the profile and to effectively process the information, NSCC incorporates certain edit checks, validations and requirements for the participants and the data.

1. Only data rejected by NSCC is returned by NSCC to the originator. Accepted information is only sent to intended recipients.

2. NSCC verifies that price and rate data for individual securities are input only by the appropriate participant. Any input containing invalid participant/security combinations are rejected.

B. Communications Interfaces.

Single and multi-cycle output from NSCC to participants for these new formats is generated through SIAC=s AutoRoute system. General distribution of price and rate information utilizes the global distribution facility. The NASD price file will use a unique product number. The following new AutoRoute product numbers will be used for production output:

C. Participant Setup

NSCC members who would like to receive Daily Price and Rate data in non-ISO format must contact their account manager or the Mutual Fund Hotline to be setup. Participants are required to perform communications testing with SIAC for output files prior to actual participation in the service. Sample data output files are available for these tests.

IV. Data Record Formats and Edit Criteria

A separate document containing the detailed fixed and variable length data record formats, edit criteria and specifications on the Daily Price and Rate facility is available by contacting NSCC's Mutual Fund Hotline at (212) 412-8893. NSCC is working to also make these formats available on the internet. More information on this effort can be obtained by calling NSCC's Mutual Fund Hotline.

V. Service Fees and Billing

At the present time, NSCC will not charge any fees to members for participation in the Price and Rate component of the Mutual Fund Profile Service.

For additional information regarding the Mutual Fund Profile Service and other mutual fund services, please contact NSCC's Mutual Fund Hotline at (212) 412-8893, your account manager or NSCC Participant Services at (212) 412-8432. Technical questions and comments concerning the functionality of these new formats should be directed to the undersigned at (212) 412-8675.

David M. Warsoff
Senior Business/Systems Analyst

Appendix A: MFPS - Price and Rate Input/Output Schedule