What is considered a "material change" that investment advisers must report to clients?

A "material change" that investment advisers must report to clients refers to significant modifications that could impact the relationship or financial well-being of the clients. When it comes to changes in services or fee structure, these alterations typically affect the contract between the adviser and the client and can influence how the client perceives the value or cost of the adviser's services. Therefore, clients need to be informed about such changes to make informed decisions about their investment strategies.

Factors like regular updates in newsletters or minor adjustments in investment recommendations do not qualify as material changes, as they do not significantly alter the terms of service or the client's fees. Similarly, while changes in asset allocation strategies can be important, they may not always constitute a material change requiring disclosure unless they involve a substantial shift in the overall investment approach. Hence, option C accurately identifies the significance of changes that necessitate communication with clients in a compliance context.