[Federal Register Volume 61, Number 50 (Wednesday, March 13, 1996)]
[Notices]
[Page 10407]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-5962]



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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request; Extension: Rule 17a-13; SEC 
File No. 270-27; OMB Control No. 3235-0035

    Upon written request, copies available from: Securities and 
Exchange Commission, Office of Filings and Information Services, 
Washington, DC 20549.
    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 approval of extension on the following rule:
    Rule 17a-13(b) requires that at least once each calendar quarter, 
brokers and dealers physically examine and count all securities held 
and account for all other securities not in their possession, but 
subject to the broker-dealer's control or direction. Any discrepancies 
between the broker-dealer's securities count and the firm's records 
must be noted and, within seven days, the unaccounted for difference 
must be recorded in the firm's records. Rule 17a-13(c) provides that 
under specified conditions, the securities count, examination and 
verification of the broker-dealer's entire list of securities may be 
conducted on a cyclical basis rather than on a certain date. Although 
Rule 17a-13 does not require filing a report with the Commission, the 
discrepancies must be reported on the form required by Rule 17a-5.
    The information obtained from Rule 17a-13 is used as an inventory 
control device to monitor a broker-dealer's ability to account for all 
securities held, in transfer, in transit, pledged, loaned, borrowed, 
deposited or otherwise subject to the firm's control or direction. 
Discrepancies between the securities counts and the broker-dealer's 
records alert the Commission and the Self Regulatory Organizations 
(``SROs'') to those firms having problems in their back offices.
    Because of the many variations in the amount of securities that 
broker-dealers are accountable for, it is difficult to develop a 
meaningful figure for the cost of compliance with Rule 17a-13. About 
fifteen percent of all registered brokers and dealers are exempt from 
Rule 17a-13. Another significant amount of firms have minimal 
obligations under the rule because they hold, or are owed few 
securities. Approximately 5,000 broker-dealers have obligations under 
the rule and the average time it would take each broker-dealer to 
comply with the rule is 100 hours per year, for a total estimated 
annualized burden of 500,000 hours. It should be noted that most 
broker-dealers would engage in the activities required by Rule 17a-13 
even if they were not required to do so.
    Written comments are invited on: (a) whether the proposed 
collection of information is necessary for the proper performance of 
the functions of the agency, including whether the information shall 
have practical utility; (b) the accuracy of the agency's estimate of 
the burden of the proposed collection of information; (c) ways to 
enhance the quality, utility, and clarity of the information to be 
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.
    Direct your written comments to Michael E. Bartell, Associate 
Executive Director, Office of Information Technology, Securities and 
Exchange Commission, 450 5th Street, N.W., Washington, DC 20549.

    Dated: March 7, 1996.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-5962 Filed 3-12-96; 8:45 am]
BILLING CODE 8010-01-M