[Federal Register Volume 84, Number 156 (Tuesday, August 13, 2019)]
[Notices]
[Pages 40111-40112]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-17298]


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SECURITIES AND EXCHANGE COMMISSION


Proposed Collection; Comment Request

Upon Written Request, Copies Available From: Securities and Exchange 
Commission, Office of FOIA Services, 100 F Street NE, Washington, DC 
20549-2736

Extension:
    Rule 31a-2, SEC File No. 270-174, OMB Control No. 3235-0179

    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 (the ``Commission'') is soliciting comments on the 
collection of information summarized below. The Commission plans to 
submit this existing collection of information to the Office of 
Management and Budget (``OMB'') for extension and approval.
    Section 31(a)(1) of the Investment Company Act of 1940 (15 U.S.C. 
80a-1 et seq.) (the ``Act'') requires registered investment companies 
(``funds'') and certain underwriters, broker-dealers, investment 
advisers, and depositors to maintain and preserve records as prescribed 
by Commission rules. Rule 31a-1 (17 CFR 270.31a-1) under the Act 
specifies the books and records that

[[Page 40112]]

each of these entities must maintain. Rule 31a-2 (17 CFR 270.31a-2) 
under the Act specifies the time periods that entities must retain 
certain books and records, including those required to be maintained 
under rule 31a-1.
    The retention of records, as required by the rule, is necessary to 
ensure access to material business and financial information about 
funds and certain related entities. We periodically inspect the 
operations of funds to ensure they are in compliance with the Act and 
regulations under the Act. Due to the limits on our resources, however, 
each fund may only be inspected at intervals of several years. In 
addition, the prosecution of persons who have engaged in certain 
violations of the federal securities laws may not be limited by timing 
restrictions. For these reasons, we often need information relating to 
events or transactions that occurred years ago. Without the requirement 
to preserve books, records, and other documents, our staff would have 
difficulty determining whether the fund was in compliance with the law 
in such areas as valuation of its portfolio securities, computation of 
the prices investors paid, and, when purchasing and selling fund 
shares, types and amounts of expenses the fund incurred, kinds of 
investments the fund purchased, actions of affiliated persons, or 
whether the fund had engaged in any illegal or fraudulent activities. 
As part of our examinations of funds, our staff also reviews the 
materials that directors consider in approving the advisory contract.
    There are 3,160 funds currently operating as of December 31, 2018, 
all of which are required to comply with rule 31a-2. The Commission 
staff estimates that, on average, a fund spends 220.4 hours annually to 
comply with the rule. The Commission therefore estimates the total 
annual hour burden of the rule's and form's paperwork requirements to 
be 696,464 hours. In addition to the burden hours, the Commission staff 
estimates that the average yearly cost to each fund that is subject to 
rule 31a-2 is about $36,510.28. The Commission estimates total annual 
cost is therefore about $115.4 million.
    Estimates of average burden hours and costs are made solely for 
purposes of the Paperwork Reduction Act and are not derived from a 
comprehensive or even representative survey or study of the costs of 
Commission rules and forms. Compliance with the collection of 
information requirements of the rule is mandatory. Responses to the 
disclosure requirements will not be kept confidential. 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 OMB 
control number.
    Written comments are invited on: (a) Whether the collection of 
information is necessary for the proper performance of the functions of 
the Commission, including whether the information has practical 
utility; (b) the accuracy of the Commission's estimate of the burden of 
the collection of information; (c) ways to enhance the quality, 
utility, and clarity of the information 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.
    Please direct your written comments to Charles Riddle, Acting 
Director and Chief Information Officer, Securities and Exchange 
Commission, c/o Candace Kenner, 100 F Street NE, Washington, DC 20549; 
or send an email to: [email protected].
    All submissions should refer to File Number 270-174. This file 
number should be included on the subject line if email is used. The 
Commission will post all comments on the Commission's internet website 
(http://www.sec.gov). All comments received will be posted without 
change; we do not edit personal identifying information from 
submissions. You should submit only information that you wish to make 
available publicly.

    Dated: August 7, 2019.
Jill M. Peterson,
Assistant Secretary.
[FR Doc. 2019-17298 Filed 8-12-19; 8:45 am]
BILLING CODE 8011-01-P