Order Approving Public Company Accounting Oversight Board Budget and Annual Accounting Support Fee for Calendar Year 2014, 8210-8211 [2014-02899]
Download as PDF
<![CDATA[
tkelley on DSK3SPTVN1PROD with NOTICES
8210
Federal Register / Vol. 79, No. 28 / Tuesday, February 11, 2014 / Notices
consideration to be paid or received, are
fair and reasonable and do not involve
overreaching by any person concerned.
Applicants state that the proposed
contribution by Dividend Trust of a
portion of its assets to Global Trust in
exchange for shares of Global Trust
common stock will be based on the fair
value of such assets computed as of the
close of trading on the New York State
Exchange on a business day to be
selected by the Board of Dividend Trust
(such business day, the ‘‘Valuation
Date’’), in the same manner as for
purposes of the daily net asset valuation
for Dividend Trust. The Transaction
will occur after the close of trading on
the New York Stock Exchange on the
Valuation Date. Applicants anticipate
that such assets will consist largely or
exclusively of cash and short-term fixed
income instruments and thus will pose
no issues with respect to valuation.
Shares of Global Trust common stock
distributed by Dividend Trust in the
Transaction will be valued based on the
value of Global Trust’s assets. ‘‘Value’’
for those purposes will be determined in
accordance with the provisions of
section 2(a)(41) of the Act and rule 2a–
4 under the Act.
5. With respect to the Transaction,
each Board, including a majority of the
Independent Trustees, determined that
participation in the Transaction is in the
best interests of Dividend Trust or
Global Trust, as applicable, and that the
interests of the existing shareholders of
Dividend Trust or Global Trust, as
applicable, will not be diluted as a
result of the Transaction. These
findings, and the basis upon which the
findings were made, will be recorded
fully in the minute book of Dividend
Trust or Global Trust, as applicable.
6. Applicants state that the
Transaction will be consistent with the
stated investment policies of Dividend
Trust and Global Trust as disclosed to
shareholders. The distribution of shares
of Global Trust common stock will not
initially change the position of Dividend
Trust’s shareholders with respect to the
underlying investments that they then
own. The Proxy Statement/Prospectus
will be used to solicit the approval of
Dividend Trust’s shareholders of the
Transaction at a vote to take place
following the issuance of the requested
order. Dividend Trust’s shareholders
will have the opportunity to vote on the
Transaction after having received
disclosure concerning the Transaction.
7. Applicants also seek an order under
section 17(d) of the Act and rule 17d–
1 under the Act. Section 17(d) and rule
17d–1 prohibit affiliated persons from
participating in joint arrangements with
a registered investment company unless
VerDate Mar<15>2010
17:58 Feb 10, 2014
Jkt 232001
authorized by the Commission. In
passing on applications for these orders,
rule 17d–1 provides that the
Commission will consider whether the
participation of the investment
company is consistent with the
provisions, policies and purposes of the
Act, and the extent to which the
participation is on a basis different from
or less advantageous than that of the
other participants. Applicants request
an order pursuant to rule 17d–1 to the
extent that the participation of
applicants in the Transaction may be
deemed to constitute a prohibited joint
transaction.
8. Applicants state that the
Transaction will not place any of
Dividend Trust, Global Trust, or existing
shareholders of Dividend Trust in a
position less advantageous than that of
any other person. The value of Dividend
Trust’s assets transferred to Global Trust
(and the shares of Global Trust common
stock received in return) will be based
on the fair value of such assets
computed as of the close of trading on
the New York Stock Exchange on the
Valuation Date in accordance with the
requirements of the Act and pursuant to
valuation procedures adopted by the
Board of Dividend Trust. The shares of
Global Trust common stock will be
distributed to Dividend Trust’s common
shareholders, leaving the shareholders
in the same investment posture
immediately following the Transaction
as before, subject only to changes in
market price of the underlying assets
subsequent to the Transaction.
9. Applicants assert that the
Transaction has been proposed in order
to benefit the shareholders of Dividend
Trust as well as Global Trust.
Applicants state that neither the Adviser
nor any other affiliated person of
Dividend Trust or Global Trust will
receive additional fees solely as a result
of the Transaction. In addition,
applicants state that although it is
possible that the creation of Global
Trust may benefit the Adviser by
providing it with an additional managed
fund, the Board of Dividend Trust has
determined that such result does not
supply a benefit that could not have
otherwise been achieved through an
initial public offering of a global equity
securities fund and that such benefit is
both marginal and hypothetical because
the assets of Dividend Trust to be
contributed to Global Trust pursuant to
the Transaction represent only
approximately 5.0% of Dividend Trust’s
net assets as of December 31, 2013. In
addition, by creating Global Trust
through the Transaction, Dividend Trust
is effectively enabling its common
shareholders to receive securities
PO 00000
Frm 00060
Fmt 4703
Sfmt 4703
without the costs associated with a
public offering.
For the Commission, by the Division of
Investment Management, under delegated
authority.
Kevin M. O’Neill,
Deputy Secretary.
[FR Doc. 2014–02933 Filed 2–10–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Securities Act of 1933; Release No. 9546/
February 5, 2014; Securities Exchange Act
of 1934; Release No. 71494/February 5,
2014]
Order Approving Public Company
Accounting Oversight Board Budget
and Annual Accounting Support Fee
for Calendar Year 2014
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.
1 15
U.S.C. 7201 et seq.
L. No. 111–203, 124 Stat. 1376 (2010).
2 Pub.
E:\FR\FM\11FEN1.SGM
11FEN1
tkelley on DSK3SPTVN1PROD with NOTICES
Federal Register / Vol. 79, No. 28 / Tuesday, February 11, 2014 / Notices
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 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 2013 the PCAOB provided the
Commission with a narrative
description of its program issues and
outlook for the 2014 budget year. In
response, the Commission provided the
PCAOB with economic assumptions and
budgetary guidance for the 2014 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 2013 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 25, 2013, the PCAOB
approved its 2014 budget during an
open meeting, and subsequently
submitted that budget to the
Commission for approval.
After considering the above, the
Commission did not identify any
proposed disbursements in the 2014
budget adopted by the PCAOB that are
not properly recoverable through the
annual accounting support fee, and the
Commission believes that the aggregate
proposed 2014 annual accounting
3 17
CFR 202.190.
VerDate Mar<15>2010
17:58 Feb 10, 2014
Jkt 232001
support fee does not exceed the
PCAOB’s aggregate recoverable budget
expenses for 2014. The Commission also
acknowledges the PCAOB’s updated
strategic plan and is supportive of the
Board’s continued work on its six new
near-term priority projects. The
Commission encourages the PCAOB to
continue keeping the Commission and
its staff apprised of developments
throughout the implementation of these
near-term projects and looks forward to
providing views to the PCAOB as future
updates are made to the plan.
The Commission understands that in
recent years the PCAOB has taken
significant and productive steps to
improve its information technology
(‘‘IT’’) program. These steps include IT
staffing changes, implementing stronger
IT governance structures, and
strengthening Board oversight over its
IT program. Based upon updates
provided by the PCAOB, the
Commission also understands that these
efforts are ongoing; and 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 continue to 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 2014 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 2014,
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 understands that the
Office of Management and Budget
(‘‘OMB’’) has determined the 2014
budget of the PCAOB to be sequestrable
under the Budget Control Act of 2011.4
4 See ‘‘OMB Report Pursuant to the Sequestration
Transparency Act of 2012’’ (Pub. L. 112–155), page
218 of 224 at: https://www.whitehouse.gov/sites/
PO 00000
Frm 00061
Fmt 4703
Sfmt 4703
8211
Unless legislation occurs that avoids
sequestration, the PCAOB’s 2014
spending level would be reduced. In the
event that sequestration is not avoided,
we expect the PCAOB to work with the
Commission and Commission staff, as
appropriate, regarding the impact of
sequestration on the PCAOB’s 2014
spending.
The Commission has determined that
the PCAOB’s 2014 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 2014 are
approved.
By the Commission.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2014–02899 Filed 2–10–14; 8:45 am]
BILLING CODE 8011–01–P
SECURITIES AND EXCHANGE
COMMISSION
[Release No. 34–71489; File No. SR–CBOE–
2013–107]
Self-Regulatory Organizations;
Chicago Board Options Exchange,
Incorporated; Notice of Withdrawal of
Proposed Rule Change To Amend Its
Rules Regarding Option Orders That
Include a Stock Component
February 5, 2014.
On October 31, 2013, the Chicago
Board Options Exchange, Incorporated
(the ‘‘Exchange’’ or ‘‘CBOE’’) filed with
the Securities and Exchange
Commission (the ‘‘Commission’’),
pursuant to Section 19(b)(1) of the
Securities Exchange Act of 1934 (the
‘‘Act’’) 1 and Rule 19b 4 thereunder,2 a
proposed rule change to amend CBOE’s
rules regarding option orders that
include a stock component. The
proposed rule change was published for
comment in the Federal Register on
November 19, 2013.3 The Commission
received two comment letters regarding
the proposed rule change.4 On
December 23, 2013, the Commission
extended the time period in which to
default/files/omb/assets/legislative_reports/
stareport.pdf.
1 15 U.S.C. 78s(b)(1).
2 17 CFR 240.19b–4.
3 See Securities Exchange Act Release No. 70857
(November 13, 2013), 78 FR 69487.
4 See letters to Elizabeth M. Murphy, Secretary,
Commission, from Manisha Kimmel, Executive
Director, Financial Information Forum, dated
December 10, 2013; and Ellen Greene, Vice
President, Securities Industry and Financial
Markets Association, dated December 16, 2013.
E:\FR\FM\11FEN1.SGM
11FEN1
]]>Agencies
[Federal Register Volume 79, Number 28 (Tuesday, February 11, 2014)]
[Notices]
[Pages 8210-8211]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-02899]
-----------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
[Securities Act of 1933; Release No. 9546/February 5, 2014; Securities
Exchange Act of 1934; Release No. 71494/February 5, 2014]
Order Approving Public Company Accounting Oversight Board Budget
and Annual Accounting Support Fee for Calendar Year 2014
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\ Pub. L. No. 111-203, 124 Stat. 1376 (2010).
---------------------------------------------------------------------------
[[Page 8211]]
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 2013 the PCAOB
provided the Commission with a narrative description of its program
issues and outlook for the 2014 budget year. In response, the
Commission provided the PCAOB with economic assumptions and budgetary
guidance for the 2014 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 2013 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 25,
2013, the PCAOB approved its 2014 budget during an open meeting, and
subsequently submitted that budget to the Commission for approval.
After considering the above, the Commission did not identify any
proposed disbursements in the 2014 budget adopted by the PCAOB that are
not properly recoverable through the annual accounting support fee, and
the Commission believes that the aggregate proposed 2014 annual
accounting support fee does not exceed the PCAOB's aggregate
recoverable budget expenses for 2014. The Commission also acknowledges
the PCAOB's updated strategic plan and is supportive of the Board's
continued work on its six new near-term priority projects. The
Commission encourages the PCAOB to continue keeping the Commission and
its staff apprised of developments throughout the implementation of
these near-term projects and looks forward to providing views to the
PCAOB as future updates are made to the plan.
The Commission understands that in recent years the PCAOB has taken
significant and productive steps to improve its information technology
(``IT'') program. These steps include IT staffing changes, implementing
stronger IT governance structures, and strengthening Board oversight
over its IT program. Based upon updates provided by the PCAOB, the
Commission also understands that these efforts are ongoing; and 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 continue to 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 2014 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 2014, 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 understands that the Office of Management and Budget
(``OMB'') has determined the 2014 budget of the PCAOB to be
sequestrable under the Budget Control Act of 2011.\4\ Unless
legislation occurs that avoids sequestration, the PCAOB's 2014 spending
level would be reduced. In the event that sequestration is not avoided,
we expect the PCAOB to work with the Commission and Commission staff,
as appropriate, regarding the impact of sequestration on the PCAOB's
2014 spending.
---------------------------------------------------------------------------
\4\ See ``OMB Report Pursuant to the Sequestration Transparency
Act of 2012'' (Pub. L. 112-155), page 218 of 224 at: https://www.whitehouse.gov/sites/default/files/omb/assets/legislative_reports/stareport.pdf.
---------------------------------------------------------------------------
The Commission has determined that the PCAOB's 2014 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 2014 are approved.
By the Commission.
Elizabeth M. Murphy,
Secretary.
[FR Doc. 2014-02899 Filed 2-10-14; 8:45 am]
BILLING CODE 8011-01-P
