The SEC on Jan. 31, 2017, issued Release No. 33-10297, Order Regarding Review of FASB Accounting Support Fee For 2017 Under Section 109 of the Sarbanes-Oxley Act Of 2002, to approve the fees from public companies that the standard-setter for U.S. GAAP uses to support its operations.
As has been the case in recent years, the SEC noted that the fee is subject to the sequestration process established by the Budget Control Act of 2011, which caps the spending for government agencies. The FASB and PCAOB are not government agencies, but because the support fees that underwrite their annual budgets must be approved each year, the federal government has determined that they are subject to sequestration.
In Release No. 33-10297 the SEC asked the FASB to assess the financial reporting taxonomy, or data tagging information, for submitting financial statements to the SEC in the extensible Business Reporting Language (XBRL) and submit the findings before the SEC considers next year’s support fee. The market regulator also asked the FASB to keep it apprised about its efforts to fill vacancies on the accounting board and the efforts to improve the FASB’s standard-setting process.
Release No. 33-10297 also instructs the FASB to submit quarterly updates to the SEC regarding the findings of a review of the accounting board’s Investor Advisory Committee. The SEC asked for information about the panel’s recommendations on standard-setting activity, funding, membership, and meetings.
The annual accounting support fees were established under Section 109 of the Sarbanes-Oxley Act of 2002 and make up the FASB’s largest funding source.
The SEC said it reviewed the 2017 budget of the FASB and the Financial Accounting Foundation (FAF), the FASB’s parent organization. Under Section 109, the fee cannot exceed the accounting board’s recoverable budget expenses.
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