SARBANES-OXLEY ACT OF 2002 COMPLIANCE PROGRAM
STATEMENT OF POLICY, DISCLOSURE REVIEW PROCEDURES, AND DISCLOSURE
CONTROLS AND PROCEDURES
MEMBERS MUTUAL FUNDS AND ULTRA SERIES FUND
ADOPTED DECEMBER 15, 2002
AMENDED JUNE 19, 2003
AMENDED AUGUST 26, 2004
I. STATEMENT OF POLICY
On August 28, 2002, the Securities and Exchange Commission (the "SEC") adopted
rules to implement the principal executive officer ("PEO") and principal
financial officer ("PFO") certification requirements of Section 302 of the
Sarbanes-Oxley Act of 2002 (the "Act"). Rule 30a-2 under the Investment Company
Act of 1940 (the "1940 Act") requires each PEO and PFO, individually, to sign
certain specified certifications to be included as exhibits to each N-CSR and
N-Q reports filed for a mutual fund with the SEC. In addition, Rule 30a-3 under
the 1940 Act requires mutual funds to maintain written disclosure controls and
procedures ("DCPs") covering Forms N-CSR and N-Q filings by mutual funds.
It is the policy of each of MEMBERS Mutual Funds ("MMF") and Ultra Series Fund
("USF"), and collectively, the "Funds" and each individually, a "Fund", to
maintain the required DCPs for the purpose of ensuring that information required
to be disclosed in Forms N-CSR and N-Q Filings ("Covered SEC Filings") made with
the SEC is recorded, processed, summarized and reported in an accurate and
complete manner within the applicable time periods. The Funds' DCPs are designed
to provide a sufficient framework for the accumulation and communication of
relevant disclosure information to the management of each Fund. Each Fund and
its respective personnel remain committed to the accuracy of all Covered SEC
Filings made by the Fund.
II. DISCLOSURE CONTROLS AND PROCEDURES
Consistent with the requirements of the Act, the Funds have implemented the
following written DCPs designed to ensure that information required to be
disclosed in Covered SEC Filings is recorded, processed, summarized and reported
in an accurate and complete manner within the time periods applicable to such
Covered SEC Filing.
A. IDENTIFICATION OF DISCLOSURE SOURCES FOR COVERED SEC FILINGS
The following CUNA Mutual Group, CUNA Mutual Life Insurance Company and
MEMBERS Capital Advisors personnel and personnel of the Funds' outside
service providers ("Disclosure Sources") have been identified as parties
essential to the timely identification and communication of information
and events triggering disclosures contained within Covered SEC Filings on
Forms N-CSR and N-Q.
Information relative to necessary disclosures for Covered SEC Filings made
by the Funds on Forms N-CSR and N-Q are identified, processed, recorded,
summarized and reported to the Funds' management by the following:
Fund Administration
Internal Source - Senior Manager, Product Operations
External Source - Boston Financial Data Services, Fund Administrator
It is the responsibility of the Senior Manager for Product Operations to
request, obtain and verify information for which the Fund Administrator
serves as the source.
Financial Information
Internal Source - Internal Audit Vice President, Finance
Internal Audit Manager, Finance
External Source - Deloitte & Touche
Fund Operations/Investments
Internal Source - Vice President, Product Manager
Senior Manager, Investment Operations*
Investment Support Manager, Investment Operations
* responsible for collecting and disseminating N-CSR and
N-Q disclosure information provided by funds'
sub-advisers
Legal Division
Internal Source - AVP and Associate General Counsel, Legal
Division ("Disclosure Coordinator")
Law Specialist, Legal Division
External Source - Sutherland Asbill & Brennan
It is the responsibility of the Legal Division to request, obtain and
verify disclosure information received from external legal counsel.
Transfer Agent
MEMBERS Funds - State Street Bank and Trust Company
Ultra Series Fund - Variable Products Finance Technician, CUNA Mutual Life
Insurance Company ("CMLIC")
B. DISCLOSURE COMMITTEE AND RESPONSIBILITIES
The Funds have established a Disclosure Committee comprised of members of
the CUNA Mutual Group Legal and MEMBERS Capital Advisors personnel from
their respective Investment Operations, Product Operations, and Sales,
Marketing and Client Services areas. The members of the Funds' Disclosure
Committee are as follows:
Senior Manager, Product Operations
Senior Manager, Investment Operations
Investment Support Manager, Investment Operations
AVP and Associate General Counsel, Legal Division
Securities Law Specialist, Legal Division
The Disclosure Coordinator for each Fund's Disclosure Committee is
Assistant Vice President and Associate General Counsel, Legal Division.
The Disclosure Coordinator shall serve as the Chairperson of each Fund's
Disclosure Committee.
The members of the Funds' Disclosure Committee shall be responsible for
the development, implementation and maintenance of the Funds' DCPs on a
continuous basis throughout the year (referred to hereinafter as the
"Disclosure Development and Review Process"). Responsibilities shall
include the development of a timeline for Covered SEC Filings, the
documentation of a process for updating and revising required disclosures
within Covered SEC Filings, as well as execution of existing DCPs and
documentation of such execution.
C. DISCLOSURE DEVELOPMENT AND REVIEW PROCESS
Documentation. Each Fund has developed a Time and Responsibility Checklist
that reflects the appropriate timeframes for the identification,
summarization, circulation for review and comment, revision and approval
of appropriate disclosures contained in Covered SEC filings. Each member
of the Disclosure Committee shall be responsible for initialing the Time
and Responsibility Checklist to identify the scope of his or her
participation in the Disclosure Development and Review Process and to
indicate the date the indicated action was completed.
For all Covered SEC Filings, Disclosure Committee members shall obtain
initials from Disclosure Sources and an indication of the dates that
disclosure information was requested, in a manner sufficient to enable
such member to sign the relevant Disclosure Report (as defined in Section
III below) provided to the relevant Fund's PEO/PFO in connection with such
Covered SEC Filing.
It is understood by the members of the Disclosure Committee that the Time
and Responsibility Checklist is intended to evidence to each Fund's
management, including its PEO and PFO, that the Disclosure Development and
Review Process is operating in a manner sufficient to ensure the timely
and accurate recordation, processing, summarization and reporting of
relevant disclosures to be contained in Covered SEC Filings in an accurate
and complete manner within the applicable time periods required by law or
regulation.
Process. It is the responsibility of the Disclosure Committee to determine
the necessary disclosures for inclusion in each Covered SEC Filing. Each
Fund contemplates that Disclosure Committee members shall reach a
consensus concerning those disclosures to be included in each Covered SEC
Filing. In reaching such a consensus, sufficient attention must be given
to ensure that the disclosures contained in a particular Covered SEC
Filing satisfy the applicable legal standards. This determination shall be
made by the participating members from the Legal Division and from the
Fund Compliance Area.
In determining those events or circumstances that may trigger the need for
a change or updating of the disclosures contained in a Covered SEC Filing,
for purposes of regularly updating disclosures as periodically required
under applicable law or regulation, the Disclosure Committee shall consult
each of the Disclosure Sources listed above, as to the necessity of
updating or revising of each Covered SEC Filing for which such Disclosure
Source has been identified as providing disclosure information. The
Disclosure Committee shall be responsible for indicating on the Time and
Responsibility Checklist that the Disclosure Source has been consulted,
the date the request for disclosure information was made, whether a
revision to the disclosure for a Covered SEC Filing was suggested, and the
date of any response to a request for disclosure information was received.
The Disclosure Committee member making a request for disclosure
information from any person identified herein as a Disclosure Source shall
ensure that such person initials and dates the checklist on the date any
disclosure information is provided.
Further, with respect to events or changes in circumstances triggering a
revision to disclosure contained in an SEC Covered Filing, the Disclosure
Committee will keep the Disclosure Coordinator informed of all
developments that come to their attention.
Accommodations of Committee Member Viewpoints. In the event that a
difference of opinion arises among members of the Disclosure Committee
concerning the necessity of making a disclosure revision identified by a
Disclosure Source, or concerning the manner in which such disclosure
revision may be made, Disclosure Committee representatives from the Legal
Division shall make a recommendation to the relevant Fund personnel,
including such Fund's Compliance Area concerning the disclosure in
question. If necessary to resolve a continuing conflict, outside counsel
for the Fund and/or counsel for the Fund's independent trustees shall also
be consulted, with the result that the Disclosure Committee
representatives from the Legal Division shall make a final recommendation
reflecting consideration of the advice provided by such external counsel.
The Disclosure Committee shall acquiesce to the recommendation from the
Legal Division Disclosure Committee attorney representative, who is
currently the Disclosure Coordinator. Legal Division members involved in
the resolution of conflicts, as contemplated herein, shall take all
necessary steps to preserve the existence of attorney-client privilege in
connection with the conflict resolution process.
Unanticipated Disclosure Events. Upon receipt of notice of an event or
change in circumstance ("Disclosure Event") which may necessitate a
revision to a disclosure contained in a Covered SEC Filing, the Disclosure
Committee shall, within a reasonable period of time, given the
circumstances, from such receipt of such notice, determine whether there
is a need to modify any disclosure contained in a Covered SEC Filing and
shall determine the manner of such modification. In such event, the
Disclosure Committee shall either meet to discuss the Disclosure Event, at
which meeting any determination made by the committee shall be recorded
and the record maintained for a period of no less than six years, the
first two years in a readily accessible place, or else the Disclosure
Committee shall circulate a communication for review and authorization by
each Disclosure Committee member indicating the decision regarding the
impact that the Disclosure Event has had on existing disclosures contained
within the Covered SEC Filing. Such signed communication shall be
maintained by the relevant Fund for a period of no less than six years,
the first two years in a readily accessible place.
In addition, the Disclosure Committee shall, when it determines the need
arises, notify the relevant Fund's PEO and PFO, as well as the appropriate
senior management of the relevant Fund, of material changes to disclosure
information.
D. RESOURCES ASSISTING THE FUNDS IN THE DEVELOPMENT AND MAINTENANCE OF
DCPS
It is contemplated that members of the Disclosure Committee shall attend
such industry conferences and other continuing education activities as may
be reasonably necessary to ensure that they maintain current knowledge on
industry issues and practices affecting the timeliness and accuracy of
disclosures contained in Covered SEC Filings and Fund compliance with
applicable legal and regulatory guidelines relative thereto. Disclosure
Committee members currently receive such trade publications and attend
such conferences sponsored by a variety of industry trade associations and
service providers as they, together with their respective managers, deem
necessary in order to maintain current knowledge of industry issues and
practices.
In addition, each Fund contemplates that the expeditious use of outside
counsel and counsel for its independent trustees also provide effective
control measures to ensure the integrity and efficacy of its DCPs.
Similarly, various external service providers, such as each Fund's
transfer agent and the Funds' administrator and independent auditors also
serve as important control mechanisms for purposes of bolstering Fund
compliance with all applicable laws and regulations relative to
disclosures contained in Covered SEC Filings.
III. REPORTING TO EACH FUND'S PEO AND PFO
It is the responsibility of each respective Fund's PEO and PFO to work with the
Disclosure Committee to design, implement, monitor and maintain these DCPs and
their implementation to ensure that the necessary communication is communicated
to them to enable them to make the required certifications required under the
Act in connection with each Covered SEC Filing. Each Fund's PEO and PFO shall
each review each Covered SEC Filing pursuant to the deadline determined and
communicated to them by the Disclosure Committee, which deadline shall be, in
the normal course of business, no earlier than five business days prior to
filing of the SEC Covered Filing. In the case of the absence of a PEO or PFO,
such Fund's Secretary or Assistant Treasurer shall assume the corresponding
responsibilities hereunder of such officer.
Communications by Disclosure Committee to PEO and PFO. For all Covered SEC
Filings made after the effective date hereof, the Disclosure Committee shall
prepare and deliver a report ("Disclosure Report") to accompany each draft
Covered SEC Filing to be reviewed by the relevant Fund's PEO and PFO. Such
report shall overview the contents of the Covered SEC Filing and shall, as
necessary, set forth material disclosure changes and material disclosure issues
that arose during the process of preparing the filing and for which substantive
judgments were made by the Disclosure Committee concerning their inclusion or
exclusion in the Covered SEC Filing. The Disclosure Report shall be delivered to
the PEO and PFO within the timeframe that the Covered SEC Filing is being
developed and finalized for filing. For all Covered SEC Filings made after the
effective date hereof, in order to satisfy the PEO and PFO of the sufficiency of
these DCPs to ensure the accuracy and completeness of the disclosures contained
in the relevant Covered SEC Filing, accompanying the Disclosure Report shall be
a copy of a completed Time and Responsibility Checklist evidencing the necessary
participation and approvals indicated therein by each Disclosure Committee
member.
In particular, the Disclosure Report shall assure the PEO and PFO that: (1) the
Covered SEC Filing does not contain any untrue statement of material fact or
omit to state a material fact necessary in order to make the statements made, in
light of the circumstances under which such statements were made, not misleading
with respect to the period covered by the filing; (2) the financial information
included in the filing, and the financial statements on which it is based,
fairly present in all material respects the financial condition, results of
operations, changes in net assets and cash flows of the relevant Fund as of, and
for the periods presented in the filing; and (3) fraud, whether or not material,
involving management or other employees with a significant role in the relevant
Fund's internal controls have been reported to the PEO and PFO during the period
covered by the Covered SEC Filing.
In the case of annual updates to registration statements to be filed with the
SEC, the Disclosure Committee may prepare and present one Disclosure Report for
review and sign-off by the relevant Fund's PEO and PFO, so long as the PEO and
PFO shall each have sufficient time to review the Disclosure Report and the
registration statement to be filed.
IV. ANNUAL EVALUATION OF DCPS
Upon delivery by the Disclosure Committee of the Disclosure Report accompanying
an SEC Covered Filing, which delivery shall occur within 90 days prior to such
filing, each Fund's PEO and PFO shall evaluate these DCPs so as to enable them
to make the necessary certifications contained in applicable exhibits to the
Covered SEC Filing. Such evaluation by the PEO and PFO shall cover the relevant
Fund's DCPs as they relate to all Covered SEC Filings made since the last
Covered SEC Filing was made, beginning with Form N-CSR filings made in June,
2003, with Form N-Q filings made in September, 2004, and continuing thereafter.
Review and Assessment of DCP's. It shall be the responsibility of Internal
Audit, together with external counsel, to review these DCPs and prepare and
distribute an Annual Assessment of DCPs to each Fund's PEO and PFO. Such Annual
Assessment of DCPs shall set forth those conclusions necessary to enable the PEO
and PFO to make the certifications as to their annual review of the DCPs and the
sufficiency of such DCPs that are required to be made and presented in the
applicable exhibit to Covered SEC Filings.
In conjunction with assessing these DCPs and their ongoing use by the Funds,
Internal Audit shall also consider the internal controls and procedures for
financial reporting utilized by the Funds and the Fund Administrator that affect
the Funds' ability to record, process, summarize and report financial
information required to be disclosed by the Funds in reports they file or submit
under the federal securities laws.
Disclosure of Deficiencies to Audit Committee and Independent Auditors. Each
Fund's PEO and PFO shall disclose affirmatively and preemptively to its
independent auditors and to its Audit Committee any significant deficiencies in
the design or operation of internal controls which could adversely affect such
Fund's ability to record, process, summarize and report financial data, as well
as any fraud, whether or not material, that involved Fund management or other
Fund employees who have a significant role in the Fund's internal controls.
V. IMPLEMENTATION OF DCPS
The Statement of Policy, Disclosure Review Procedures and DCPs contained herein
have been approved and adopted by each Fund's PEO and PFO, respectively,
effective June 19, 2003. It is contemplated that appropriate members of the
Disclosure Committee shall undertake to develop and implement a training
program, on or shortly after the date hereof. It shall be the responsibility of
the Disclosure Committee to develop and maintain such training program to ensure
that relevant Fund personnel are appropriately trained in the appropriate DCPs
relative to record making and recordkeeping obligations under the Funds'
Disclosure Review Process and these DCPs, as well as the steps necessary to
facilitate "up-the-chain" reporting to each Fund's PEO and PFO and support for
each Fund's PEO and PFO as they execute their certification responsibilities.