[Federal Register: November 9, 2006 (Volume 71, Number 217)]
[Notices]
[Page 65843]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr09no06-138]
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SECURITIES AND EXCHANGE COMMISSION
Submission for OMB Review; Comment Request
Upon Written Request, Copies Available From: Securities and Exchange
Commission, Office of Filings and Information Services, Washington,
DC 20549.
Rule 17a-5; SEC File No. 270-155; OMB Control No. 3235-0123.
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 (``Commission'') has submitted to the Office of Management
and Budget a request for extension of the previously approved
collection of information discussed below.
Rule 17a-5 (17 CFR 240.17a-5) is the basic financial reporting rule
for brokers and dealers.\1\ The Rule requires the filing of the
Financial and Operational Combined Uniform Single Report (``FOCUS
Report'') on Form X-17A-5 (17 CFR 240.15c3-1e), which was the result of
years of study and comments by representatives of the securities
industry through advisory committees and through the normal rule
proposal methods. The FOCUS Report was designed to eliminate the
overlapping regulatory reports required by various self-regulatory
organizations and the Commission and to reduce reporting burdens as
much as possible. The Rule also requires the filing of an annual
audited report of financial statements.
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\1\ Rule 17a-5(c) requires a broker or dealer to furnish certain
of its financial information to customers and is subject to a
separate PRA filing (OMB Control Number 3235-0199).
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The FOCUS Report consists of: (1) Part I, which is a monthly report
that must be filed by brokers or dealers that clear transactions or
carry customer securities; (2) one of three alternative quarterly
reports: Part II, which must be filed by brokers or dealers that clear
transactions or carry customer securities; Part IIA, which must be
filed by brokers or dealers that do not clear transactions or carry
customer securities; and Part IIB, which must be filed by specialized
broker-dealers registered with the Commission as OTC derivatives
dealers; \2\ (3) supplemental schedules, which must be filed annually;
and (4) a facing page, which must be filed with the annual audited
report of financial statements. Under the Rule, a broker or dealer that
computes certain of its capital charges in accordance with Appendix E
to Exchange Act Rule 15c3-1 (17 CFR 240.15c3-1e) must file additional
monthly, quarterly, and annual reports with the Commission.
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\2\ Part IIB of Form X-17A-5 must be filed by OTC derivatives
dealers under Exchange Act Rule 17a-12 and is subject to a separate
PRA filing (OMB Control Number 3235-0498).
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The variation in the size and complexity of brokers and dealers
subject to Rule 17a-5 and the differences in the FOCUS Report forms
that must be filed under the Rule make it difficult to calculate the
cost of compliance. However, we estimate, on average, that each report
will require approximately 12 hours. At year-end 2005, the Commission
estimates that there were approximately 6,200 brokers or dealers, and
that of those firms there were approximately 600 brokers or dealers
that clear transactions or carry customer securities. In addition,
approximately 400 firms filed annual reports. The Commission therefore
estimates that approximately 600 firms filed monthly reports,
approximately 5,600 firms filed quarterly reports, and approximately
400 firms filed annual reports. In addition, approximately 6,200 firms
filed annual audited reports. As a result, there were approximately
36,200 total annual responses ((600 x 12) + (5,600 x 4) + 400 + 6,200 =
36,200). This results in an estimated annual burden of 434,400 hours
(36,200 annual responses x 12 hours = 434,400).
In addition, we estimate that approximately 11 brokers or dealers
will elect to use Appendix E to Rule 15c3-1 to compute certain of their
capital charges (as of June 2006, five brokers or dealers have elected
to use Appendix E). We estimate that the average amount of time
necessary to prepare and file the additional monthly reports that must
be filed by these firms is about 4 hours per month, or approximately 48
hours per year; the average amount of time necessary to prepare and
file the additional quarterly reports is about 8 hours per quarter, or
approximately 32 hours per year; and the average amount of time
necessary to prepare and file the additional supplemental reports with
the annual audit required is approximately 40 hours per year.
Consequently, we estimate that the total additional annual burden for
these 11 brokers or dealers is approximately 1,320 hours ((48 + 32 +
40) x 11 = 1,320).
The Commission therefore estimates that the total annual burden
under Rule 17a-5 is approximately 435,700 hours (434,400 + 1,320 =
435,720, rounded to 435,700).
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.
Comments regarding the estimated burden hours should be directed
to: (i) The 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 e-mail to David_Rostker@omb.eop.gov; and (ii) R. Corey Booth,
Director/Chief Information Officer, Securities and Exchange Commission,
c/o Shirley Martinson, 6432 General Green Way, Alexandria, VA 22312, or
by e-mail to PRA_Mailbox@sec.gov. Comments must be submitted to the
Office of Management and Budget within 30 days of this notice.
November 3, 2006.
Nancy M. Morris,
Secretary.
[FR Doc. E6-18950 Filed 11-8-06; 8:45 am]
BILLING CODE 8011-01-P