82 FR 9434 - Order Regarding Review of FASB Accounting Support Fee for 2017 Under Section 109 of The Sarbanes-Oxley Act of 2002
SECURITIES AND EXCHANGE COMMISSION Federal Register Volume 82, Issue 23 (February 6, 2017)
Federal Register Volume 82, Issue 23 (February 6, 2017)
| Page Range | 9434-9435 | |
| FR Document | 2017-02413 |
[Federal Register Volume 82, Number 23 (Monday, February 6, 2017)] [Notices] [Pages 9434-9435] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2017-02413] ----------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION [Securities Act of 1933, Release No. 33-10297/January 31, 2017; Securities Exchange Act of 1934, Release No. 34-79912/January 31, 2017] Order Regarding Review of FASB Accounting Support Fee for 2017 Under Section 109 of The Sarbanes-Oxley Act of 2002 The Sarbanes-Oxley Act of 2002 (the ``Act'') provides that the Securities and Exchange Commission (the ``Commission'') may recognize, as generally accepted for purposes of the securities laws, any accounting principles established by a standard setting body that meets certain criteria. Consequently, Section 109 of the Act provides that all of the budget of such a standard setting body shall be payable from an annual accounting support fee assessed and collected against each issuer, as may be necessary or appropriate to pay for the budget and provide for the expenses of the standard setting body, and to provide for an independent, stable source of funding, subject to review by the Commission. Under Section 109(f) of the Act, the amount of fees collected for a fiscal year shall not exceed the ``recoverable budget expenses'' of the standard setting body. Section 109(h) amends Section 13(b)(2) of the Securities Exchange Act of 1934 to require issuers to pay the allocable share of a reasonable annual accounting support fee or fees, determined in accordance with Section 109 of the Act. On April 25, 2003, the Commission issued a policy statement concluding that the Financial Accounting Standards Board (``FASB'') and its parent organization, the Financial Accounting Foundation (``FAF''), satisfied the criteria for an accounting standard-setting body under the Act, and recognizing the FASB's financial accounting and reporting standards as ``generally accepted'' under Section 108 of the Act.\1\ As a consequence of that recognition, the Commission undertook a review of the FASB's accounting support fee for calendar year 2017.\2\ In connection with its review, the Commission also reviewed the budget for the FAF and the FASB for calendar year 2017. --------------------------------------------------------------------------- \1\ Financial Reporting Release No. 70. \2\ The Financial Accounting Foundation's Board of Trustees approved the FASB's budget on November 15, 2016. The FAF submitted the approved budget to the Commission on November 22, 2016. --------------------------------------------------------------------------- Section 109 of the Act also provides that the standard setting body can have additional sources of revenue for its activities, such as earnings from sales of publications, provided that each additional source of revenue shall not jeopardize, in the judgment of the Commission, the actual or perceived independence of the standard setter. In this regard, the Commission also considered the interrelation of the operating budgets of the FAF, the FASB, and the Governmental Accounting Standards Board (``GASB''), the FASB's sister organization, which sets accounting standards used by state and local government entities. The Commission has been advised by the FAF that neither the FAF, the FASB, nor the GASB accept contributions from the accounting profession. The Commission understands that the Office of Management and Budget (``OMB'') has determined the FASB's spending of the 2017 accounting support fee is sequestrable under the Budget Control Act of 2011.\3\ So long as sequestration is applicable, we anticipate that the FAF will work with the Commission and Commission staff as appropriate regarding its implementation of sequestration. --------------------------------------------------------------------------- \3\ See ``OMB Report Pursuant to the Sequestration Transparency Act of 2012'' (Pub. L. 112-155), page 222 of 224 at: http://www.whitehouse.gov/sites/default/files/omb/assets/legislative_reports/stareport.pdf. --------------------------------------------------------------------------- The Commission understands that FASB recently conducted a review of its Investor Advisory Committee (``IAC''). We anticipate that the FASB will keep the Commission informed of IAC-related actions, including any efforts the FASB undertakes to improve the functioning of the IAC. In this regard, the Commission requests that the FASB provide the Commission with quarterly updates of its efforts to reach a broader set of investors as well as the IAC's recommendations, funding, [[Page 9435]] membership, meetings, research, and substantive public sessions. The Commission understands that the FASB continues to take steps to implement improvements to the performance and management of its standard-setting process. The Commission requests that the FASB provide the Commission with timely updates throughout the year on the progress of this initiative as well as on any significant recommended or anticipated changes to processes or funding. The Commission requests that the FASB conduct an assessment of the efficiency and effectiveness of the U.S. GAAP Financial Reporting Taxonomy and report the findings, including suggested improvements, to the Commission prior to the FAF's approval of the FASB's 2018 budget and associated accounting support fee for review by the Commission. The Commission also requests that the FAF provide information to the Commission regarding the nature, timing, and extent of public solicitation of potential candidates for FASB Board member vacancies. After its review, the Commission determined that the 2017 annual accounting support fee for the FASB is consistent with Section 109 of the Act. Accordingly, It is ordered, pursuant to Section 109 of the Act, that the FASB may act in accordance with this determination of the Commission. By the Commission. Brent J. Fields, Secretary. [FR Doc. 2017-02413 Filed 2-3-17; 8:45 am] BILLING CODE 8011-01-P
![9434 Federal Register / Vol. 82, No. 23 / Monday, February 6, 2017 / Notices
1. Any investment company owning competitive indications with respect to Foundation (‘‘FAF’’), satisfied the
voting stock of any Trust in excess of the specific proposed transaction from criteria for an accounting standard-
the limits imposed by section 12(d)(1) of two other independent government setting body under the Act, and
the Act will be required by the Trust’s securities dealers. Competitive recognizing the FASB’s financial
charter documents, or will undertake, to quotation information must include accounting and reporting standards as
vote its Trust shares in proportion to the price and settlement terms. These ‘‘generally accepted’’ under Section 108
vote of all other Holders. dealers must be those who, in the of the Act.1 As a consequence of that
2. The trustees of each Trust, experience of the Trust’s trustees, have recognition, the Commission undertook
including a majority of the trustees who demonstrated the consistent ability to a review of the FASB’s accounting
are not interested persons of the Trust, provide professional execution of support fee for calendar year 2017.2 In
(a) will adopt procedures that are Treasury transactions at competitive connection with its review, the
reasonably designed to provide that the market prices. They also must be those Commission also reviewed the budget
conditions set forth below have been who are in a position to quote favorable for the FAF and the FASB for calendar
complied with; (b) will make and prices. year 2017.
approve such changes as are deemed For the Commission, by the Division of Section 109 of the Act also provides
necessary; and (c) will determine that Investment Management, under delegated that the standard setting body can have
the transactions made pursuant to the authority. additional sources of revenue for its
order were effected in compliance with Eduardo A. Aleman, activities, such as earnings from sales of
such procedures. Assistant Secretary. publications, provided that each
3. The Trusts (1) will maintain and additional source of revenue shall not
[FR Doc. 2017–02360 Filed 2–3–17; 8:45 am]
preserve in an easily accessible place a jeopardize, in the judgment of the
BILLING CODE 8011–01–P
written copy of the procedures (and any Commission, the actual or perceived
modifications thereto), and (ii) will independence of the standard setter. In
maintain and preserve for the longer of SECURITIES AND EXCHANGE this regard, the Commission also
(x) the life of the Trusts and (y) six years COMMISSION considered the interrelation of the
following the purchase of any operating budgets of the FAF, the FASB,
Treasuries, the first two years in an [Securities Act of 1933, Release No. 33– and the Governmental Accounting
easily accessible place, a written record 10297/January 31, 2017; Securities Standards Board (‘‘GASB’’), the FASB’s
of all Treasuries purchased, whether or Exchange Act of 1934, Release No. 34– sister organization, which sets
79912/January 31, 2017]
not from Applicant, setting forth a accounting standards used by state and
description of the Treasuries purchased, Order Regarding Review of FASB local government entities. The
the identity of the seller, the terms of Accounting Support Fee for 2017 Commission has been advised by the
the purchase, and the information or Under Section 109 of The Sarbanes- FAF that neither the FAF, the FASB, nor
materials upon which the Oxley Act of 2002 the GASB accept contributions from the
determinations described below were accounting profession.
made. The Sarbanes-Oxley Act of 2002 (the The Commission understands that the
4. The Treasuries to be purchased by ‘‘Act’’) provides that the Securities and Office of Management and Budget
each Trust will be sufficient to provide Exchange Commission (the (‘‘OMB’’) has determined the FASB’s
payments to Holders that are consistent ‘‘Commission’’) may recognize, as spending of the 2017 accounting
with the investment objectives and generally accepted for purposes of the support fee is sequestrable under the
policies of the Trust as recited in the securities laws, any accounting Budget Control Act of 2011.3 So long as
Trust’s registration statement and will principles established by a standard sequestration is applicable, we
be consistent with the interests of the setting body that meets certain criteria. anticipate that the FAF will work with
Trust and the Holders of its Securities. Consequently, Section 109 of the Act the Commission and Commission staff
5. The terms of the transactions will provides that all of the budget of such as appropriate regarding its
be reasonable and fair to the Holders of a standard setting body shall be payable implementation of sequestration.
the Securities issued by each Trust and from an annual accounting support fee The Commission understands that
will not involve overreaching of the assessed and collected against each FASB recently conducted a review of its
Trust or the Holders of Securities of the issuer, as may be necessary or Investor Advisory Committee (‘‘IAC’’).
Trust on the part of any person appropriate to pay for the budget and We anticipate that the FASB will keep
concerned. provide for the expenses of the standard the Commission informed of IAC-related
6. The fee, spread, or other setting body, and to provide for an actions, including any efforts the FASB
remuneration to be received by independent, stable source of funding, undertakes to improve the functioning
Applicant will be reasonable and fair subject to review by the Commission. of the IAC. In this regard, the
compared to the fee, spread, or other Under Section 109(f) of the Act, the Commission requests that the FASB
remuneration received by dealers in amount of fees collected for a fiscal year provide the Commission with quarterly
connection with comparable shall not exceed the ‘‘recoverable budget updates of its efforts to reach a broader
transactions at such time, and will expenses’’ of the standard setting body. set of investors as well as the IAC’s
comply with section 17(e)(2)(C) of the Section 109(h) amends Section 13(b)(2) recommendations, funding,
Act. of the Securities Exchange Act of 1934
7. Before any Treasuries are to require issuers to pay the allocable 1 Financial Reporting Release No. 70.
2 The Financial Accounting Foundation’s Board
purchased by the Trust, the Trust must
sradovich on DSK3GMQ082PROD with NOTICES
share of a reasonable annual accounting
of Trustees approved the FASB’s budget on
obtain such available market support fee or fees, determined in November 15, 2016. The FAF submitted the
information as it deems necessary to accordance with Section 109 of the Act. approved budget to the Commission on November
determine that the price to be paid for, On April 25, 2003, the Commission 22, 2016.
3 See ‘‘OMB Report Pursuant to the Sequestration
and the terms of, the transaction are at issued a policy statement concluding
Transparency Act of 2012’’ (Pub. L. 112–155), page
least as favorable as that available from that the Financial Accounting Standards 222 of 224 at: http://www.whitehouse.gov/sites/
other sources. This shall include the Board (‘‘FASB’’) and its parent default/files/omb/assets/legislative_reports/
Trust obtaining and documenting the organization, the Financial Accounting stareport.pdf.
VerDate Sep<11>2014 16:03 Feb 03, 2017 Jkt 241001 PO 00000 Frm 00065 Fmt 4703 Sfmt 4703 E:\FR\FM\06FEN1.SGM 06FEN1](https://thefederalregister.org/doc/82_FR_9457/page/1.svg)
![Federal Register / Vol. 82, No. 23 / Monday, February 6, 2017 / Notices 9435
membership, meetings, research, and notice is hereby given that, on January Bats BYX Exchange, Inc., Bats BZX
substantive public sessions. 17, 2017, NYSE MKT LLC (the Exchange, Inc., Bats EDGA Exchange,
The Commission understands that the ‘‘Exchange’’ or ‘‘NYSE MKT’’) filed with Inc., Bats EDGX Exchange, Inc., BOX
FASB continues to take steps to the Securities and Exchange Options Exchange LLC, C2 Options
implement improvements to the Commission (the ‘‘Commission’’) the Exchange, Incorporated, Chicago Board
performance and management of its proposed rule change as described in Options Exchange, Incorporated,
standard-setting process. The Items I, II, and III below, which Items Chicago Stock Exchange, Inc., Financial
Commission requests that the FASB have been prepared by the self- Industry Regulatory Authority, Inc.,
provide the Commission with timely regulatory organization. On January 30, International Securities Exchange, LLC,
updates throughout the year on the 2017, the Exchange filed Amendment Investors’ Exchange LLC, ISE Gemini,
progress of this initiative as well as on No. 1 to the proposed rule change, LLC, ISE Mercury, LLC, Miami
any significant recommended or which amended and replaced the International Securities Exchange LLC,
anticipated changes to processes or proposed rule change in its entirety. The MIAX PEARL, LLC, NASDAQ BX, Inc.,
funding. Commission is publishing this notice to NASDAQ PHLX LLC, The NASDAQ
The Commission requests that the solicit comments on the proposed rule Stock Market LLC, National Stock
FASB conduct an assessment of the change, as amended, from interested Exchange, Inc., New York Stock
efficiency and effectiveness of the U.S. persons. Exchange LLC, NYSE MKT LLC, and
GAAP Financial Reporting Taxonomy NYSE Arca, Inc. (collectively, the
I. Self-Regulatory Organization’s
and report the findings, including ‘‘Participants’’) filed with the
Statement of the Terms of Substance of
suggested improvements, to the Commission, pursuant to Section 11A of
the Proposed Rule Change
Commission prior to the FAF’s approval the Exchange Act 5 and Rule 608 of
of the FASB’s 2018 budget and The Exchange proposed rule change Regulation NMS thereunder,6 the CAT
associated accounting support fee for to adopt the Rule 6800 Series to NMS Plan.7 The Participants filed the
review by the Commission. The implement the compliance rule Plan to comply with Rule 613 of
Commission also requests that the FAF (‘‘Compliance Rule’’) regarding the Regulation NMS under the Exchange
provide information to the Commission National Market System Plan Governing Act. The Plan was published for
regarding the nature, timing, and extent the Consolidated Audit Trail (the ‘‘CAT comment in the Federal Register on
of public solicitation of potential NMS Plan’’ or ‘‘Plan’’).4 The proposed May 17, 2016,8 and approved by the
candidates for FASB Board member rule change is available on the Commission, as modified, on November
vacancies. Exchange’s Web site at www.nyse.com, 15, 2016.9
After its review, the Commission at the principal office of the Exchange, The Plan is designed to create,
determined that the 2017 annual and at the Commission’s Public implement and maintain a consolidated
accounting support fee for the FASB is Reference Room. audit trail (‘‘CAT’’) that would capture
consistent with Section 109 of the Act. customer and order event information
II. Self-Regulatory Organization’s
Accordingly, for orders in NMS Securities and OTC
Statement of the Purpose of, and
It is ordered, pursuant to Section 109 Equity Securities, across all markets,
Statutory Basis for, the Proposed Rule
of the Act, that the FASB may act in from the time of order inception through
Change
accordance with this determination of routing, cancellation, modification, or
the Commission. In its filing with the Commission, the execution in a single consolidated data
By the Commission. self-regulatory organization included source. Each Participant is required to
Brent J. Fields,
statements concerning the purpose of, enforce compliance by its Industry
and basis for, the proposed rule change Member, as applicable, with the
Secretary.
and discussed any comments it received provisions of the Plan, by adopting a
[FR Doc. 2017–02413 Filed 2–3–17; 8:45 am]
on the proposed rule change. The text Compliance Rule applicable to their
BILLING CODE 8011–01–P of those statements may be examined at Industry Members.10 As is described
the places specified in Item IV below.
The Exchange has prepared summaries, 5 15 U.S.C. 78k–1.
SECURITIES AND EXCHANGE 6 17 CFR 242.608.
set forth in sections A, B, and C below,
COMMISSION 7 See Letter from the Participants to Brent J.
of the most significant parts of such
Fields, Secretary, Commission, dated September 30,
[Release No. 34–79911; File No. SR– statements. 2014; and Letter from Participants to Brent J. Fields,
NYSEMKT–2017–02] Secretary, Commission, dated February 27, 2015.
A. Self-Regulatory Organization’s On December 24, 2015, the Participants submitted
Self-Regulatory Organizations; NYSE Statement of the Purpose of, and the an amendment to the CAT NMS Plan. See Letter
MKT LLC; Notice of Filing of Proposed Statutory Basis for, the Proposed Rule from Participants to Brent J. Fields, Secretary,
Change Commission, dated December 23, 2015.
Rule Change, as Modified by 8 See Securities Exchange Act Release No. 77724
Amendment No. 1, To Adopt the Rule 1. Purpose (April 27, 2016), 81 FR 30614 (May 17, 2016).
6800 Series To Implement the 9 See Securities Exchange Act Release No. 79318
Compliance Rule Regarding the This Amendment No. 1 amends and (November 15, 2016), 81 FR 84696 (November 23,
National Market System Plan replaces in its entirety the original 2016) (‘‘Order Approving the National Market
proposal filed by the Exchange on System Plan Governing the Consolidated Audit
Governing the Consolidated Audit Trail Trail) (‘‘Approval Order’’).
January 17, 2017. The Exchange submits 10 See SEC Rule 613(g)(1). The proposed Rule
sradovich on DSK3GMQ082PROD with NOTICES
January 31, 2017. this Amendment No. 1 in order to 6800 Series would be applicable to member
Pursuant to Section 19(b)(1) 1 of the clarify certain points and add additional organization. The term ‘‘member organization’’ is
Securities Exchange Act of 1934 (the details to the Compliance Rule as defined in Rule 24 (Office Rules) as ‘‘a partnership,
‘‘Act’’) 2 and Rule 19b–4 thereunder,3 proposed herein. corporation or such other entity as the Exchange
may, by Rule, permit to become a member
organization, and which meets the qualifications
1 15 U.S.C.78s(b)(1). 4 Unless otherwise specified, capitalized terms specified in the Rules.’’ The term ‘‘member
2 15 U.S.C. 78a. used in this rule filing are defined as set forth organization’’ is defined in Rule 2(b)(i) (Equities
3 17 CFR 240.19b–4. herein or in the CAT NMS Plan. Continued
VerDate Sep<11>2014 16:03 Feb 03, 2017 Jkt 241001 PO 00000 Frm 00066 Fmt 4703 Sfmt 4703 E:\FR\FM\06FEN1.SGM 06FEN1](https://thefederalregister.org/doc/82_FR_9457/page/2.svg)
Document Created: 2017-02-04 00:25:38
Document Modified: 2017-02-04 00:25:38
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| FR Citation | 82 FR 9434 |
2025 Federal Register | Disclaimer | Privacy Policy
USC | CFR | eCFR