Order Approving Public Company Accounting Oversight Board Budget and Annual Accounting Support Fee for Calendar Year 2012, 2576-2577 [2012-764]
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Federal Register / Vol. 77, No. 11 / Wednesday, January 18, 2012 / Notices
adequately examine registered transfer
agents on an historical basis for
compliance with applicable rules.
The Commission estimates that
approximately 473 registered transfer
agents will spend a total of 236,500
hours per year complying with Rules
17Ad–6 and 17Ad–7 (500 hours per year
per transfer agent).
The retention period for the
recordkeeping requirements under Rule
17Ad–6 is six months to one year. In
addition, such records must be retained
for a total of two to six years or for one
year after termination of the transfer
agency, depending on the particular
record or document. The recordkeeping
requirements under Rules 17Ad–6 and
17Ad–7 are mandatory to assist the
Commission and other regulatory
agencies with monitoring transfer agents
and ensuring compliance with the rule.
This rule does not involve the collection
of confidential information.
The Commission may not conduct or
sponsor a collection of information
unless it displays a currently valid
control number. No person shall be
subject to any penalty for failing to
comply with a collection of information
subject to the Paperwork Reduction Act
that does not display a valid OMB
control number.
The public may view the background
documentation for this information
collection at the following Web site,
www.reginfo.gov. Comments should be
directed to: (i) Desk Officer for the
Securities and Exchange Commission,
Office of Information and Regulatory
Affairs, Office of Management and
Budget, Room 10102, New Executive
Office Building, Washington, DC 20503,
or by sending an email to:
Shagufta_Ahmed@omb.eop.gov; and (ii)
Thomas Bayer, Director/Chief
Information Officer, Securities and
Exchange Commission, c/o Remi PavlikSimon, 6432 General Green Way,
Alexandria, VA 22312 or send an email
to: PRA_Mailbox@sec.gov. Comments
must be submitted to OMB within 30
days of this notice.
Dated: January 11, 2011.
Kevin M. O’Neill,
Deputy Secretary.
tkelley on DSK3SPTVN1PROD with NOTICES
[FR Doc. 2012–780 Filed 1–17–12; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Securities Act of 1933 Release No. 33–
9294/January 11, 2012 Securities Exchange
Act of 1934 Release No. 34–66141/January
11, 2012]
Order Approving Public Company
Accounting Oversight Board Budget
and Annual Accounting Support Fee
for Calendar Year 2012
The Sarbanes-Oxley Act of 2002, as
amended (the ‘‘Sarbanes-Oxley Act’’),1
established the Public Company
Accounting Oversight Board (‘‘PCAOB’’)
to oversee the audits of companies that
are subject to the securities laws, and
related matters, in order to protect the
interests of investors and further the
public interest in the preparation of
informative, accurate and independent
audit reports. The PCAOB is to
accomplish these goals through
registration of public accounting firms
and standard setting, inspection, and
disciplinary programs. The PCAOB is
subject to the comprehensive oversight
of the Securities and Exchange
Commission (the ‘‘Commission’’).
Section 109 of the Sarbanes-Oxley Act
provides that the PCAOB shall establish
a reasonable annual accounting support
fee, as may be necessary or appropriate
to establish and maintain the PCAOB.
Under Section 109(f) of the SarbanesOxley Act, the aggregate annual
accounting support fee shall not exceed
the PCAOB’s aggregate ‘‘recoverable
budget expenses,’’ which may include
operating, capital and accrued items.
The PCAOB’s annual budget and
accounting support fee is subject to
approval by the Commission.
Section 982 of the Dodd-Frank Wall
Street Reform and Consumer Protection
Act (the ‘‘Dodd-Frank Act’’) 2 amended
the Sarbanes-Oxley Act to provide the
PCAOB with explicit authority to
oversee auditors of broker-dealers
registered with the Commission. In
addition, the PCAOB must allocate the
annual accounting support fee among
issuers and among brokers and dealers.
Section 109(b) of the Sarbanes-Oxley
Act directs the PCAOB to establish a
budget for each fiscal year in accordance
with the PCAOB’s internal procedures,
subject to approval by the Commission.
Rule 190 of Regulation P facilitates the
Commission’s review and approval of
PCAOB budgets and annual accounting
support fees.3 This budget rule
provides, among other things, a
timetable for the preparation and
1 15
U.S.C. 7201 et seq.
Law 111–203, 124 Stat. 1376 (2010).
3 17 CFR 202.190.
2 Public
VerDate Mar<15>2010
16:07 Jan 17, 2012
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PO 00000
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Fmt 4703
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submission of the PCAOB budget and
for Commission actions related to each
budget, a description of the information
that should be included in each budget
submission, limits on the PCAOB’s
ability to incur expenses and obligations
except as provided in the approved
budget, procedures relating to
supplemental budget requests,
requirements for the PCAOB to furnish
on a quarterly basis certain budgetrelated information, and a list of
definitions that apply to the rule and to
general discussions of PCAOB budget
matters.
In accordance with the budget rule, in
March 2011 the PCAOB provided the
Commission with a narrative
description of its program issues and
outlook for the 2012 budget year. In
response, the Commission provided the
PCAOB with economic assumptions and
budgetary guidance for the 2012 budget
year. The PCAOB subsequently
delivered a preliminary budget and
budget justification to the Commission.
Staff from the Commission’s Offices of
the Chief Accountant and Financial
Management dedicated a substantial
amount of time to the review and
analysis of the PCAOB’s programs,
projects and budget estimates; reviewed
the PCAOB’s estimates of 2011 actual
spending; and attended several meetings
with management and staff of the
PCAOB to further develop an
understanding of the PCAOB’s budget
and operations. During the course of
this review, Commission staff relied
upon representations and supporting
documentation from the PCAOB. Based
on this review, the Commission issued
a ‘‘pass back’’ letter to the PCAOB.
On November 30, 2011, the PCAOB
approved its 2012 budget during an
open meeting and submitted that budget
to the Commission for approval. Upon
review of the submitted budget and
budget justification, Commission staff
raised questions regarding the
calculation and presentation of the
accounting support fee in the budget
justification. On December 23, 2011, the
PCAOB supplemented the original
budget justification with additional
materials, including a revised
calculation and presentation of the
accounting support fee. Due to the time
needed to resolve this matter,
consideration of the budget and
accounting support fee was delayed
beyond the normal expected date of
December 23rd.4
4 See 17 CFR 202.190(c). The budget rule also
provides that in the event the Commission has not
approved a budget prior to the beginning of the
fiscal year, the PCAOB may spend funds from its
reserve and continue to incur obligations as if the
E:\FR\FM\18JAN1.SGM
18JAN1
Federal Register / Vol. 77, No. 11 / Wednesday, January 18, 2012 / Notices
tkelley on DSK3SPTVN1PROD with NOTICES
After considering the above, the
Commission did not identify any
proposed disbursements in the 2012
budget adopted by the PCAOB that are
not properly recoverable through the
annual accounting support fee, and the
Commission believes that the aggregate
proposed 2012 annual accounting
support fee does not exceed the
PCAOB’s aggregate recoverable budget
expenses for 2012. The Commission also
acknowledges the PCAOB’s updated
strategic plan and looks forward to
providing views to the PCAOB as future
updates are made to the plan.
In light of the recent report on
information technology (‘‘IT’’)
governance and staffing by the PCAOB’s
Office of Internal Oversight and
Performance Assurance,5 the
Commission understands that the
PCAOB has recently taken, and plans to
continue to take, significant steps
designed to improve its IT program.
These steps include IT staffing changes,
conducting a review of the IT program,
implementing IT governance structures,
and strengthening Board oversight over
its IT program. In addition to these
important steps, the Commission directs
the Board to continue to provide in its
quarterly reports to the Commission
detailed information about the state of
the PCAOB’s IT program, including
planned, estimated, and actual costs for
IT projects, and the level of involvement
of consultants. These reports also
should include: (a) a discussion of the
Board’s assessment of the progress and
implementation of the Board actions
mentioned above; and (b) the quarterly
IT report that will be prepared by
PCAOB staff and submitted to the
Board.
The Commission also directs the
PCAOB during the 2012 budget cycle to
continue to include in its quarterly
reports to the Commission information
about the PCAOB’s inspections
program. Such information is to
include: (a) Statistics relative to the
numbers and types of firms budgeted
and expected to be inspected in 2012,
including by location and by year the
inspections that are required to be
conducted in accordance with the
Sarbanes-Oxley Act and PCAOB rules;
(b) information about the timing of the
issuance of inspections reports for
domestic and non-U.S. inspections; and
budget most recently approved by the Commission
were continuing in effect. See 17 CFR 202.190(e)(3).
5 The PCAOB’s Office of Internal Oversight and
Performance Assurance provides internal
examination of the programs and operations of the
PCAOB. A public summary of the Office’s report on
IT is available here: https://pcaobus.org/
InternalOversight/Documents/
2011_Information_Technology.pdf.
VerDate Mar<15>2010
16:07 Jan 17, 2012
Jkt 226001
(c) updates on the PCAOB’s efforts to
establish cooperative arrangements with
respective non-U.S. authorities for
inspections required in those countries.
The Commission has determined that
the PCAOB’s 2012 budget and annual
accounting support fee are consistent
with Section 109 of the Sarbanes-Oxley
Act. Accordingly,
It is ordered, pursuant to Section 109
of the Sarbanes-Oxley Act, that the
PCAOB budget and annual accounting
support fee for calendar year 2012 are
approved.
By the Commission.
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2012–764 Filed 1–17–12; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–66132; File No. SR–
NYSEArca–2011–99]
Self-Regulatory Organizations; NYSE
Arca, Inc.; Notice of Filing and
Immediate Effectiveness of a Proposed
Rule Change Amending NYSE Arca
Equities Rule 7.11, Which Provides for
Trading Pauses in Individual Securities
Due to Extraordinary Market Volatility,
To Extend the Effective Date of the
Pilot Until July 31, 2012
January 11, 2012.
Pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’),1 and Rule 19b–4 thereunder,2
notice is hereby given that on December
28, 2011, NYSE Arca, Inc. (the
‘‘Exchange’’ or ‘‘NYSE Arca’’) filed with
the Securities and Exchange
Commission (‘‘Commission’’) the
proposed rule change as described in
Items I and II below, which Items have
been prepared by the Exchange. The
Commission is publishing this notice to
solicit comments on the proposed rule
change from interested persons.
I. Self-Regulatory Organization’s
Statement of the Terms of Substance of
the Proposed Rule Change
The Exchange proposes to amend
NYSE Arca Equities Rule 7.11, which
provides for trading pauses in
individual securities due to
extraordinary market volatility, to
extend the effective date of the pilot by
which such rule operates from the
current scheduled expiration date of
January 31, 2012, until July 31, 2012.
The text of the proposed rule change is
1 15
2 17
PO 00000
U.S.C. 78s(b)(1).
CFR 240.19b–4.
Frm 00070
Fmt 4703
2577
available at the Exchange, the
Commission’s Public Reference Room,
and www.nyse.com.
II. Self-Regulatory Organization’s
Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule
Change
In its filing with the Commission, the
Exchange included statements
concerning the purpose of and basis for
the proposed rule change and discussed
any comments it received on the
proposed rule change. The text of these
statements may be examined at the
places specified in Item IV below. The
Exchange has prepared summaries, set
forth in Sections A, B, and C below, of
the most significant parts of such
statements.
A. Self-Regulatory Organization’s
Statement of the Purpose of, and the
Statutory Basis for, the Proposed Rule
Change
1. Purpose
The Exchange proposes to amend
NYSE Arca Equities Rule 7.11, which
provides for trading pauses in
individual securities due to
extraordinary market volatility, to
extend the effective date of the pilot by
which such rule operates from the
current scheduled expiration date of
January 31, 2012,3 until July 31, 2012.
NYSE Arca Equities Rule 7.11
requires the Exchange to pause trading
in an individual security listed on the
Exchange if the price moves by a
specified percentage as compared to
prices of that security in the preceding
five-minute period during a trading day,
which period is defined as a ‘‘Trading
Pause.’’ The pilot was developed and
implemented as a market-wide initiative
by the Exchange and other national
securities exchanges in consultation
with the Commission staff and is
currently applicable to all NMS stocks
and specified exchange-traded
products.4
3 See Securities Exchange Act Release No. 65088
(August 10, 2011), 76 FR 50793 (August 16, 2011)
(SR–NYSEArca–2011–55).
4 The Exchange notes that the other national
securities exchanges and the Financial Industry
Regulatory Authority have adopted the pilot in
substantially similar form. See Securities Exchange
Act Release No. 62252 (June 10, 2010), 75 FR 34186
(June 16, 2010) (File Nos. SR–BATS–2010–014; SR–
EDGA–2010–01; SR–EDGX–2010–01; SR–BX–2010–
037; SR–ISE–2010–48; SR–NYSE–2010–39; SR–
NYSEAmex–2010–46; SR–NYSEArca–2010–41; SR–
NASDAQ–2010–061; SR–CHX–2010–10; SR–NSX–
2010–05; and SR–CBOE–2010–047) and Securities
Exchange Act Release No. 62251 (June 10, 2010), 75
FR 34183 (June 16, 2010) (SR–FINRA–2010–025).
See also Securities Exchange Act Release No. 62884
(September 10, 2010), 75 FR 56618 (September 16,
2010) (File Nos. SR–BATS–2010–018; SR–BX–
Continued
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18JAN1
]]>Agencies
[Federal Register Volume 77, Number 11 (Wednesday, January 18, 2012)]
[Notices]
[Pages 2576-2577]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-764]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Securities Act of 1933 Release No. 33-9294/January 11, 2012 Securities
Exchange Act of 1934 Release No. 34-66141/January 11, 2012]
Order Approving Public Company Accounting Oversight Board Budget
and Annual Accounting Support Fee for Calendar Year 2012
The Sarbanes-Oxley Act of 2002, as amended (the ``Sarbanes-Oxley
Act''),\1\ established the Public Company Accounting Oversight Board
(``PCAOB'') to oversee the audits of companies that are subject to the
securities laws, and related matters, in order to protect the interests
of investors and further the public interest in the preparation of
informative, accurate and independent audit reports. The PCAOB is to
accomplish these goals through registration of public accounting firms
and standard setting, inspection, and disciplinary programs. The PCAOB
is subject to the comprehensive oversight of the Securities and
Exchange Commission (the ``Commission'').
---------------------------------------------------------------------------
\1\ 15 U.S.C. 7201 et seq.
---------------------------------------------------------------------------
Section 109 of the Sarbanes-Oxley Act provides that the PCAOB shall
establish a reasonable annual accounting support fee, as may be
necessary or appropriate to establish and maintain the PCAOB. Under
Section 109(f) of the Sarbanes-Oxley Act, the aggregate annual
accounting support fee shall not exceed the PCAOB's aggregate
``recoverable budget expenses,'' which may include operating, capital
and accrued items. The PCAOB's annual budget and accounting support fee
is subject to approval by the Commission.
Section 982 of the Dodd-Frank Wall Street Reform and Consumer
Protection Act (the ``Dodd-Frank Act'') \2\ amended the Sarbanes-Oxley
Act to provide the PCAOB with explicit authority to oversee auditors of
broker-dealers registered with the Commission. In addition, the PCAOB
must allocate the annual accounting support fee among issuers and among
brokers and dealers.
---------------------------------------------------------------------------
\2\ Public Law 111-203, 124 Stat. 1376 (2010).
---------------------------------------------------------------------------
Section 109(b) of the Sarbanes-Oxley Act directs the PCAOB to
establish a budget for each fiscal year in accordance with the PCAOB's
internal procedures, subject to approval by the Commission. Rule 190 of
Regulation P facilitates the Commission's review and approval of PCAOB
budgets and annual accounting support fees.\3\ This budget rule
provides, among other things, a timetable for the preparation and
submission of the PCAOB budget and for Commission actions related to
each budget, a description of the information that should be included
in each budget submission, limits on the PCAOB's ability to incur
expenses and obligations except as provided in the approved budget,
procedures relating to supplemental budget requests, requirements for
the PCAOB to furnish on a quarterly basis certain budget-related
information, and a list of definitions that apply to the rule and to
general discussions of PCAOB budget matters.
---------------------------------------------------------------------------
\3\ 17 CFR 202.190.
---------------------------------------------------------------------------
In accordance with the budget rule, in March 2011 the PCAOB
provided the Commission with a narrative description of its program
issues and outlook for the 2012 budget year. In response, the
Commission provided the PCAOB with economic assumptions and budgetary
guidance for the 2012 budget year. The PCAOB subsequently delivered a
preliminary budget and budget justification to the Commission. Staff
from the Commission's Offices of the Chief Accountant and Financial
Management dedicated a substantial amount of time to the review and
analysis of the PCAOB's programs, projects and budget estimates;
reviewed the PCAOB's estimates of 2011 actual spending; and attended
several meetings with management and staff of the PCAOB to further
develop an understanding of the PCAOB's budget and operations. During
the course of this review, Commission staff relied upon representations
and supporting documentation from the PCAOB. Based on this review, the
Commission issued a ``pass back'' letter to the PCAOB.
On November 30, 2011, the PCAOB approved its 2012 budget during an
open meeting and submitted that budget to the Commission for approval.
Upon review of the submitted budget and budget justification,
Commission staff raised questions regarding the calculation and
presentation of the accounting support fee in the budget justification.
On December 23, 2011, the PCAOB supplemented the original budget
justification with additional materials, including a revised
calculation and presentation of the accounting support fee. Due to the
time needed to resolve this matter, consideration of the budget and
accounting support fee was delayed beyond the normal expected date of
December 23rd.\4\
---------------------------------------------------------------------------
\4\ See 17 CFR 202.190(c). The budget rule also provides that in
the event the Commission has not approved a budget prior to the
beginning of the fiscal year, the PCAOB may spend funds from its
reserve and continue to incur obligations as if the budget most
recently approved by the Commission were continuing in effect. See
17 CFR 202.190(e)(3).
---------------------------------------------------------------------------
[[Page 2577]]
After considering the above, the Commission did not identify any
proposed disbursements in the 2012 budget adopted by the PCAOB that are
not properly recoverable through the annual accounting support fee, and
the Commission believes that the aggregate proposed 2012 annual
accounting support fee does not exceed the PCAOB's aggregate
recoverable budget expenses for 2012. The Commission also acknowledges
the PCAOB's updated strategic plan and looks forward to providing views
to the PCAOB as future updates are made to the plan.
In light of the recent report on information technology (``IT'')
governance and staffing by the PCAOB's Office of Internal Oversight and
Performance Assurance,\5\ the Commission understands that the PCAOB has
recently taken, and plans to continue to take, significant steps
designed to improve its IT program. These steps include IT staffing
changes, conducting a review of the IT program, implementing IT
governance structures, and strengthening Board oversight over its IT
program. In addition to these important steps, the Commission directs
the Board to continue to provide in its quarterly reports to the
Commission detailed information about the state of the PCAOB's IT
program, including planned, estimated, and actual costs for IT
projects, and the level of involvement of consultants. These reports
also should include: (a) a discussion of the Board's assessment of the
progress and implementation of the Board actions mentioned above; and
(b) the quarterly IT report that will be prepared by PCAOB staff and
submitted to the Board.
---------------------------------------------------------------------------
\5\ The PCAOB's Office of Internal Oversight and Performance
Assurance provides internal examination of the programs and
operations of the PCAOB. A public summary of the Office's report on
IT is available here: https://pcaobus.org/InternalOversight/Documents/2011_Information_Technology.pdf.
---------------------------------------------------------------------------
The Commission also directs the PCAOB during the 2012 budget cycle
to continue to include in its quarterly reports to the Commission
information about the PCAOB's inspections program. Such information is
to include: (a) Statistics relative to the numbers and types of firms
budgeted and expected to be inspected in 2012, including by location
and by year the inspections that are required to be conducted in
accordance with the Sarbanes-Oxley Act and PCAOB rules; (b) information
about the timing of the issuance of inspections reports for domestic
and non-U.S. inspections; and (c) updates on the PCAOB's efforts to
establish cooperative arrangements with respective non-U.S. authorities
for inspections required in those countries.
The Commission has determined that the PCAOB's 2012 budget and
annual accounting support fee are consistent with Section 109 of the
Sarbanes-Oxley Act. Accordingly,
It is ordered, pursuant to Section 109 of the Sarbanes-Oxley Act,
that the PCAOB budget and annual accounting support fee for calendar
year 2012 are approved.
By the Commission.
Kevin M. O'Neill,
Deputy Secretary.
[FR Doc. 2012-764 Filed 1-17-12; 8:45 am]
BILLING CODE 8011-01-P
