[Federal Register Volume 70, Number 45 (Wednesday, March 9, 2005)]
[Notices]
[Pages 11718-11719]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-983]


-----------------------------------------------------------------------

SECURITIES AND EXCHANGE COMMISSION

[Securities Act of 1933, Release No. 8549/March 3, 2005 and Securities 
Exchange Act of 1934, Release No. 51312/March 3, 2005]


Order Regarding Review of FASB Accounting Support Fee for 
Calendar Year 2005 Under the Sarbanes-Oxley Act of 2002

    The Sarbanes-Oxley Act of 2002 (the ``Act'') establishes criteria 
that must be met in order for the accounting standards established by 
an accounting standard-setting body to be recognized as ``generally 
accepted'' for purposes of the federal securities laws. Section 109 of 
the Act provides that all of the budget of an accounting standard-
setting body satisfying these criteria shall be payable from an annual 
accounting support fee assessed and collected against issuers, as may 
be necessary or appropriate to pay for the budget and provide for the 
expenses of the standard setting body, and to provide for an 
independent, stable source of funding, subject to review by the 
Commission. Under Section 109(f), the annual accounting support fee 
shall not exceed the amount of the standard setter's ``recoverable 
budget expenses,'' which may include operating, capital and accrued 
items. Section 109(h) amends Section 13(b)(2) of the Securities 
Exchange Act of 1934 to require issuers to pay the allocable share of a 
reasonable annual accounting support fee or fees, determined in 
accordance with Section 109 of the Act.
    On April 25, 2003, the Commission issued a policy statement 
concluding that the Financial Accounting Standards Board (``FASB'') and 
its parent organization, the Financial Accounting Foundation (``FAF''), 
satisfied the criteria for an accounting standard-setting body under 
the Act, and recognizing the FASB's financial accounting and reporting 
standards as ``generally accepted'' under Section 108 of the Act.\1\ As 
a consequence of that recognition, the Commission undertook a review of 
the FASB's accounting support fee for calendar year 2005. In connection 
with its review, the Commission also reviewed the proposed budget for 
the FAF and the FASB for calendar year 2005.
---------------------------------------------------------------------------

    \1\ Financial Reporting Release No. 70.
---------------------------------------------------------------------------

    Section 109 of the Act also provides that the standard setting body 
can have additional sources of revenue for its activities, such as 
earnings from sales of publications, provided that each additional 
source of revenue shall not jeopardize the actual or perceived 
independence of the standard setter. In

[[Page 11719]]

this regard, the Commission also considered the interrelation of the 
operating budgets of the FAF, the FASB and the Government Accounting 
Standards Board (``GASB''), the FASB's sister organization, which sets 
accounting standards to be used by state and local government entities. 
The FAF has advised the Commission that none of the FAF, the FASB and 
the GASB accept contributions from the accounting profession.
    After its review, the Commission determined that the 2005 annual 
accounting support fee for the FASB is consistent with Section 109 of 
the Act. Accordingly,
    It is ordered pursuant to Section 109 of the Act that the FASB may 
act in accordance with this determination of the Commission.

    By the Commission.
J. Lynn Taylor,
Assistant Secretary.
[FR Doc. E5-983 Filed 3-8-05; 8:45 am]
BILLING CODE 8010-01-P