Proposed Collection; Comment Request, 67216 [E8-26955]

Download as PDF 67216 Federal Register / Vol. 73, No. 220 / Thursday, November 13, 2008 / Notices SECURITIES AND EXCHANGE COMMISSION Proposed Collection; Comment Request Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of Investor Education and Advocacy, Washington, DC 20549–0213. Extension: Rule 17f–1; SEC File No. 270–236; OMB Control No. 3235–0222. mstockstill on PROD1PC66 with NOTICES Notice is hereby given that pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (the ‘‘Commission’’) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of Management and Budget for extension and approval. Rule 17f–1 (17 CFR 270.17f–1) under the Investment Company Act of 1940 (the ‘‘Act’’) (15 U.S.C. 80a) is entitled: ‘‘Custody of Securities with Members of National Securities Exchanges.’’ Rule 17f–1 provides that any registered management investment company (‘‘fund’’) that wishes to place its assets in the custody of a national securities exchange member may do so only under a written contract that must be ratified initially and approved annually by a majority of the fund’s board of directors. The written contract also must contain certain specified provisions. In addition, the rule requires an independent public accountant to examine the fund’s assets in the custody of the exchange member at least three times during the fund’s fiscal year. The rule requires the written contract and the certificate of each examination to be transmitted to the Commission. The purpose of the rule is to ensure the safekeeping of fund assets. Commission staff estimates that each fund makes 1 response and spends an average of 3.5 hours annually in complying with the rule’s requirements. Commission staff estimates that on an annual basis it takes: (i) 0.5 hours for the board of directors 1 to review and ratify the custodial contracts; and (ii) 3 hours for the fund’s controller to assist the fund’s independent public auditors in verifying the fund’s assets. Approximately 5 funds rely on the rule 1 Estimates of the number of hours are based on conversations with representatives of mutual funds that comply with the rule. The actual number of hours may vary significantly depending on individual fund assets. The hour burden for rule 17f–1 does not include preparing the custody contract because that would be part of customary and usual business practice. VerDate Aug<31>2005 17:13 Nov 12, 2008 Jkt 217001 annually, with a total of 5 responses.2 Thus, the total annual hour burden for rule 17f–1 is approximately 17.5 hours.3 Funds that rely on rule 17f–1 generally use outside counsel to prepare the custodial contract for the board’s review and to transmit the contract to the Commission. Commission staff estimates the cost of outside counsel to perform these tasks for a fund each year is $800.4 Funds also must have an independent public accountant verify the fund’s assets three times each year and prepare the certificate of examination. Commission staff estimates the annual cost for an independent public accountant to perform this service is $4000.5 Therefore, the total annual cost burden for a fund that relies on rule 17f–1 would be approximately $4800.6 As noted above, the staff estimates that 5 funds rely on rule 17f–1 each year, for an estimated total annualized cost burden of $24,000.7 The estimate of average burden hours is made solely for the purposes of the Paperwork Reduction Act, and is not derived from a comprehensive or even a representative survey or study of the costs of Commission rules. Compliance with the collections of information required by rule 17f–1 is mandatory for funds that place their assets in the custody of a national securities exchange member. Responses will not be kept confidential. An agency may not conduct or sponsor, and a person is not required to respond to a collection of information unless it displays a currently valid control number. The Commission requests written comments on: (a) Whether the collections of information are necessary for the proper performance of the functions of the Commission, including whether the information has practical utility; (b) the accuracy of the 2 Based on a review of Form N–17f–1 filings in 2006 and 2007, the Commission staff estimates that an average of 5 funds rely on rule 17f–1 each year. 3 This estimate is based on the following calculation: (5 respondents x 3.5 hours = 17.5 hours. The annual burden for rule 17f–1 does not include time spent preparing Form N–17f–1. The burden for Form N–17f–1 is included in a separate collection of information. 4 This estimate is based on the following calculation: (2 hours of outside counsel time x $400 = $800). The staff has estimated the average cost of outside counsel at $400 per hour, based on information received from funds, fund intermediaries, and their counsel. 5 This estimate is based on information received from fund representatives estimating the aggregate annual cost of an independent public accountant’s periodic verification of assets and preparation of the certificate of examination. 6 This estimate is based on the following calculation: ($800 + $4000 = $4800). 7 This estimate is based on the following calculation: (5 funds × $4800 = $24,000). PO 00000 Frm 00099 Fmt 4703 Sfmt 4703 Commission’s estimate of the burdens of the collection of information; (c) ways to enhance the quality, utility, and clarity of the information collected; and (d) ways to minimize the burden of the collection of information on respondents, including through the use of automated collection techniques or other forms of information technology. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication. Please direct your written comments to Lewis W. Walker, Acting Director/ CIO, Securities and Exchange Commission, C/O Shirley Martinson, 6432 General Green Way, Alexandria, VA 22312; or send an e-mail to: PRA_Mailbox@sec.gov. Dated: November 5, 2008. Florence E. Harmon, Acting Secretary. [FR Doc. E8–26955 Filed 11–12–08; 8:45 am] BILLING CODE 8011–01–P SECURITIES AND EXCHANGE COMMISSION Proposed Collection; Comment Request Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of Investor Education and Advocacy, Washington, DC 20549–0213. Extension: Rule 11a–3; SEC File No. 270–321; OMB Control No. 3235–0358. Notice is hereby given that pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501–3520), the Securities and Exchange Commission (the ‘‘Commission’’) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of Management and Budget for extension and approval. Section 11(a) of the Investment Company Act of 1940 (‘‘Act’’) (15 U.S.C. 80a–11(a)) provides that it is unlawful for a registered open-end investment company (‘‘fund’’) or its underwriter to make an offer to the fund’s shareholders or the shareholders of any other fund to exchange the fund’s securities for securities of the same or another fund on any basis other than the relative net asset values (‘‘NAVs’’) of the respective securities to be exchanged, ‘‘unless the terms of the offer have first been submitted to and approved by the Commission or are in accordance with such rules and regulations as the E:\FR\FM\13NON1.SGM 13NON1

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[Federal Register Volume 73, Number 220 (Thursday, November 13, 2008)]
[Notices]
[Page 67216]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-26955]



[[Page 67216]]

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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of Investor Education and Advocacy, Washington, DC 
20549-0213.

Extension:
    Rule 17f-1; SEC File No. 270-236; OMB Control No. 3235-0222.

    Notice is hereby given that pursuant to the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange 
Commission (the ``Commission'') is soliciting comments on the 
collection of information summarized below. The Commission plans to 
submit this existing collection of information to the Office of 
Management and Budget for extension and approval.
    Rule 17f-1 (17 CFR 270.17f-1) under the Investment Company Act of 
1940 (the ``Act'') (15 U.S.C. 80a) is entitled: ``Custody of Securities 
with Members of National Securities Exchanges.'' Rule 17f-1 provides 
that any registered management investment company (``fund'') that 
wishes to place its assets in the custody of a national securities 
exchange member may do so only under a written contract that must be 
ratified initially and approved annually by a majority of the fund's 
board of directors. The written contract also must contain certain 
specified provisions. In addition, the rule requires an independent 
public accountant to examine the fund's assets in the custody of the 
exchange member at least three times during the fund's fiscal year. The 
rule requires the written contract and the certificate of each 
examination to be transmitted to the Commission. The purpose of the 
rule is to ensure the safekeeping of fund assets.
    Commission staff estimates that each fund makes 1 response and 
spends an average of 3.5 hours annually in complying with the rule's 
requirements. Commission staff estimates that on an annual basis it 
takes: (i) 0.5 hours for the board of directors \1\ to review and 
ratify the custodial contracts; and (ii) 3 hours for the fund's 
controller to assist the fund's independent public auditors in 
verifying the fund's assets. Approximately 5 funds rely on the rule 
annually, with a total of 5 responses.\2\ Thus, the total annual hour 
burden for rule 17f-1 is approximately 17.5 hours.\3\
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    \1\ Estimates of the number of hours are based on conversations 
with representatives of mutual funds that comply with the rule. The 
actual number of hours may vary significantly depending on 
individual fund assets. The hour burden for rule 17f-1 does not 
include preparing the custody contract because that would be part of 
customary and usual business practice.
    \2\ Based on a review of Form N-17f-1 filings in 2006 and 2007, 
the Commission staff estimates that an average of 5 funds rely on 
rule 17f-1 each year.
    \3\ This estimate is based on the following calculation: (5 
respondents x 3.5 hours = 17.5 hours. The annual burden for rule 
17f-1 does not include time spent preparing Form N-17f-1. The burden 
for Form N-17f-1 is included in a separate collection of 
information.
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    Funds that rely on rule 17f-1 generally use outside counsel to 
prepare the custodial contract for the board's review and to transmit 
the contract to the Commission. Commission staff estimates the cost of 
outside counsel to perform these tasks for a fund each year is $800.\4\ 
Funds also must have an independent public accountant verify the fund's 
assets three times each year and prepare the certificate of 
examination. Commission staff estimates the annual cost for an 
independent public accountant to perform this service is $4000.\5\ 
Therefore, the total annual cost burden for a fund that relies on rule 
17f-1 would be approximately $4800.\6\ As noted above, the staff 
estimates that 5 funds rely on rule 17f-1 each year, for an estimated 
total annualized cost burden of $24,000.\7\
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    \4\ This estimate is based on the following calculation: (2 
hours of outside counsel time x $400 = $800). The staff has 
estimated the average cost of outside counsel at $400 per hour, 
based on information received from funds, fund intermediaries, and 
their counsel.
    \5\ This estimate is based on information received from fund 
representatives estimating the aggregate annual cost of an 
independent public accountant's periodic verification of assets and 
preparation of the certificate of examination.
    \6\ This estimate is based on the following calculation: ($800 + 
$4000 = $4800).
    \7\ This estimate is based on the following calculation: (5 
funds x $4800 = $24,000).
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    The estimate of average burden hours is made solely for the 
purposes of the Paperwork Reduction Act, and is not derived from a 
comprehensive or even a representative survey or study of the costs of 
Commission rules. Compliance with the collections of information 
required by rule 17f-1 is mandatory for funds that place their assets 
in the custody of a national securities exchange member. Responses will 
not be kept confidential. An agency may not conduct or sponsor, and a 
person is not required to respond to a collection of information unless 
it displays a currently valid control number.
    The Commission requests written comments on: (a) Whether the 
collections of information are necessary for the proper performance of 
the functions of the Commission, including whether the information has 
practical utility; (b) the accuracy of the Commission's estimate of the 
burdens of the collection of information; (c) ways to enhance the 
quality, utility, and clarity of the information collected; and (d) 
ways to minimize the burden of the collection of information on 
respondents, including through the use of automated collection 
techniques or other forms of information technology. Consideration will 
be given to comments and suggestions submitted in writing within 60 
days of this publication.
    Please direct your written comments to Lewis W. Walker, Acting 
Director/CIO, Securities and Exchange Commission, C/O Shirley 
Martinson, 6432 General Green Way, Alexandria, VA 22312; or send an e-
mail to: PRA_Mailbox@sec.gov.

    Dated: November 5, 2008.
Florence E. Harmon,
Acting Secretary.
[FR Doc. E8-26955 Filed 11-12-08; 8:45 am]
BILLING CODE 8011-01-P