FY 2008 Performance Budget 

In accordance with Section 220 of Office of Management and Budget Circular A- 1 1, the 

SEC has crafted the following Performance Budget for FY 2008. This document aligns the 

goals and measures developed for the SEC's Stvategic Plan for Fiscal 2004-2009 with the 

SEC's budget request; it aims to improve the linkages between the SEC's resource needs, 

effectiveness, and outcomes. Separately, the SEC's Division of Investment Management was 

scored by OMB's Performance Assessment and Rating Tool (PART). The results of these 

assessments are included in the President's budget request for FY 2008. 

Goals and Outcomes 

As established in the SEC's strategic plan, the agency's four goals are to: 

Enforce compliance with federal securities laws; 

Promote healthy capital markets through an effective and flexible regulatory 

environment; 

Foster informed investment decision making; and 

Maximize the use of SEC resources. 

The SEC works to meet these goals by, among other things, detecting violations and 

potential problems or issues in the securities markets and ensuring that the violations are 

addressed; crafting regulations that strengthen corporate and fund governance; providing 

investors with timely access to accurate, adequate, and useful disclosure materials that can be 

easily understood and analyzed across companies, industries, or funds; and ensuring that the 

agency's human capital strategies, information technology initiatives, and resources are 

appropriately aligned to achieve the agency's mission, goals, and outcomes. 

Like other federal regulatory and law enforcement agencies, the SEC has found it 

challenging to develop measures that accurately depict the outcomes of its activities. In many 

cases, the effects of the SEC's efforts can only be indirectly assessed. The SEC continues to 

explore alternatives for measuring outcomes that help the public gauge its progress in achieving 

its mission. 

The indicators included at the end of this section are useful in understanding the SEC's 

activities, but should not be considered performance measures and do not include targets that 

the agency will strive to reach in future years. In most cases, the SEC chose not to include 

targets for these indicators because they gauge the number of violations or "significant" 

deficiencies uncovered, and it would be inappropriate for the agency to conduct these activities 

with an eye towards hitting predetermined numerical targets rather than evaluating the evidence 

as presented. 
Goal One: Enforce Compliance with Federal Securities Laws 

Performance Measure 1 

Percentage of First Enforcement Cases Filed Within Two Years 

Description: This measure identifies the percentage of first enforcement actions filed within 

two years of opening an investigation or inquiry. In conducting investigations, the Division of 

Enforcement continually strives to balance the need for complete, effective, and fair 

investigations with the need to file enforcement actions in as timely a manner as possible. 

FY 

2003 

Performance Measure 2 

Percentage of Enforcement Cases Successfully Resolved 

Description: A case is considered "successfully resolved" if it results in a favorable judgment 

for the SEC, a settlement, or the issuance of a default judgment. In general, the SEC strives to 

successfully resolve as many cases as possible but, at the same time, aims to file large, 

difficult, or precedent-setting cases when appropriate, even if success is not assured. 

FY 

2004 

98% 

FY 

2004 

FY 2008 Request: A continued high success ratio depends on numerous factors, including the 

complexity of cases, the extent to which parties contest actions, and the availability of 

litigation and investigation resources. 

FY 

2005 

99% 

FY 

2005 

62% 66% 66% - 

FY 2008 Request: The SEC anticipates maintaining a high percentage rate of the number of 

first enforcement cases filed within two years. However, this statistic is dependent on the 

types of cases brought or emphasized in a specific year, as well as completing staff priorities 

such as litigation actions already filed and the availability of litigation and investigation 

resources. 

FY 2006 

Plan 

85% 

FY 2006 

Plan 

69% 

FY 2006 

Actual 

99% 

65% 

FY 2006 

Actual 

FY 

2007 

85% 

. 66% 

FY 

2007 

FY 

2008 

85% 

64% 

FY 

2008 
Performance Measure 3 

Number of Requests to and from Foreign Regulators for Enforcement Assistance 

Description: Each year, the SEC makes hundreds of requests to foreign regulators for 

enforcement assistance, while responding to hundreds of requests from other nations. To 

facilitate this type of assistance, and encourage other countries to enact laws necessary to 

allow regulators to cooperate with their foreign counterparts, the SEC has entered into more 

than 30 bilateral information-sharing agreements, as well as the International Organization of 

Securities Commissions (IOSCO) Multilateral Memorandum of Understanding. These 

agreements create a framework for information sharing and expedite international cooperation 

among regulators. 

Requests to 

foreign regulators 

Requests from 

foreign regulators 

FY 2008 Request: The number of requests between regulators is expected to rise gradually 

through FY 2008. The FY 2007 estimate for requests to foreign regulators includes a 

reduction of over 100 requests largely attributable to the SEC's debt collection project, which 

is not expected to continue beyond FY 2006. 

FY 

2002 

448 

353 

FY 

2003 

309 

344 

FY 

2004 

380 

372 

FY 

2005 

438 

3 15 

FY 2006 

Plan 

460 

330 

FY 2006 

Actual 

56 1 

353 

FY 

2007 

460 

371 

FY 

2008 

483 

3 89 
Performance Measure 4 

Distribution of Cases Across Core Enforcement Areas 

Description: Effective deterrence of securities fraud requires that the cases filed by the SEC 

have adequate reach across all core enforcement program areas. The mix and types of cases 

vary from year to year based upon the conditions of the markets and changes in financial 

instruments being used. The SEC's enforcement program seeks to maintain a presence and 

depth so that no single area dominates its case mix, nor is underrepresented. This measure 

evaluates whether the Commission maintains an effective distribution of cases so that no 

category exceeds 40 percent of the total. 

Percentage of Cases 

FY 

2003 

FY 

2004 

Core Enforcement Program Areas 

FY 

2005 

Financial Disclosure 

Investment Advisers and 

Investment Companies 

Broker-Dealers 

Securities Offerings 

Insider Trading 

Market Manipulation 

Delinquent Filings 

Other 

Total 

FY 2006 

Plan 

FY 2008 Request: The agency will continue to maintain a presence in all program areas with 

no category exceeding 40 percent of the total amount of cases brought in any one year. The 

exact percentage may vary depending on the circumstances and priorities unique to that year. 

29% 

11% 

20% 

16% 

7% 

5% 

12% 

100% 

28% 

14% 

22% 

15% 

7% 

6% 

8% 

FY 

2008 

FY 2006 

Actual 

FY 

2007 

29% 

16% 

15% 

9% 

8% 

7% 

16% 

100% 1 100% 

<40% 

<40% 

<40% 

<40% 

<40% 

~40% 

<40% 

100% 

<40% 

<40% 

<40% 

<40% 

<40% 

<40% 

<40% 

24% 

16% 

100% 1 100% 

<40% 

<40% 

100% 

13% 1 <40% 

11% 1 <40% 

8% 1 <40% 

5% 1 ~40% 

16% 1 <40% 

7% 1 <40% <400/0 
Performance Measure 5 

Investment Advisers and Investment Companies Examined 

Description: To conduct oversight of investment companies and advisers, the staff conducts 

a risk-based program of routine examinations, cause inspections to follow up on tips and 

complaints, and perform special inspections to probe emerging risk areas. Rapid growth in the 

industry, coupled with serious compliance violations, led to changes in the SEC's oversight 

methodologies for investment companies and advisers in 2003-2004. These changes included 

significantly greater attention to identifying and evaluating the severity of risks present at 

investment companies and advisers, as well as adapting exam policies and procedures to 

address the most serious of these risks. 

Investment 

Advisers Examined 

Investment 

Companies 

Examined 

FY 2008 Request: The figures for FY 2006 and expectations for FYs 2007 and 2008 are 

lower than in previous years, for a variety of reasons. These include: an increase in the 

complexity of registrants' operations, including the need to review the activities of private 

funds in conjunction with examination of the funds' advisers (e.g., in FY 2006, more than 750 

private funds were also reviewed); a substantial increase in the time needed during each 

routine examination to evaluate the effectiveness of the compliance programs that advisers 

and funds were required to maintain beginning in FY 2005; an increase in exam scope in order 

to review advisers' and funds' compliance with other new regulatory requirements; a decrease 

in the number of targeted special examinations conducted (which are generally of shorter 

duration than routine exams); a dedication of staff resources to new proactive compliance 

initiatives designed to improve compliance, including CCOutreach and monitoring large 

advisory groups; and a decrease in resources. 

FY 

2002 

1,570 

304 

FY 

2003 

1,556 

318 

FY 

2004 

1,543 

783 

FY 

2005 

1,530 

582 

FY 2006 

Plan 

1,500 

350 

FY 

2008 

1,300 

250 

FY 2006 

Actual 

1,346 

344 

FY 

2007 

1,300 

250 

Performance Measure 3 

Global Access to US Markets: Number of New Foreign Private Issuers Registering 

Securities with the SEC and the Dollar Amount of Securities Registered by Foreign 

Private Issuers 

Description: The number of foreign companies registering securities in the United States and 

the dollar value of those registrations can be viewed as an indicator of the integrity, liquidity, 

and fairness of the US markets. 

Performance Measure 4 

Milestones for International Regulatory Cooperation 

Description: In order to sustain an effective and flexible regulatory environment in the 

face of increasingly global financial markets, the SEC works with many securities 

regulators and international organizations, including the International Organization of 

Securities Commissions (IOSCO), to improve global transparency and disclosure, 

strengthen the supervision of global firms and markets, reinforce regulatory standards, 

and enhance cross-border enforcement cooperation. SEC staff also engaged in bilateral 

regulatory dialogues with foreign authorities in order to explore common approaches for 

regulating market participants that operate on a cross-border basis. 

Initiative: Eliminating the Generally Accepted Accounting Principles (GAAP) 

reconciliation requirement for foreign issuers using International Financial Reporting 

Standards (IFRS) 

Companies 

Dollar Value 

(in billions) 

FY 

2005 

FY 

2006 

Plan 

FY 

2006 

Actual 

FY 2008 Request: It is expected that the number of new foreign companies registering their 

securities under the 1933 and 1934 Acts and the dollar value of securities registered under the 

1933 Act will increase as the US economy improves and more foreign companies adopt 

International Financial Reporting Standards (IFRS). 

FY 

2002 

70 

$147 

"Road map" published by SEC staff. 

Begin reviewing the consistency of foreign private issuers' FY 2005 IFRS 

financial statements and accompanying reconciliations; agree to cooperate 

closely with the Committee of European Securities Regulators (CESR) with 

respect to the application by internationally active companies of IFRS and 

GAAP in the United States and the European Union. 

Began reviewing the consistency of foreign private issuers' FY 2005 IFRS 

financial statements and accompanying reconciliations; agreed to cooperate 

with the Committee of European Securities Regulators (CESR) with respect 

to the application by internationally active companies of IFRS and GAAP in 

the United States and the European Union. 

FY 

2008 

70 

$150 

FY 

2003 

50 

$163 

FY 

2004 

63 

$146 

FY 

2005 

74 

$250 

FY 2006 

Plan 

50 

$250 

FY 2006 

Actual 

FY 

2007 I 

60 

$109 

70 

$150 
FY 

2007 

FY 

2008 

Discuss implications of review with public constituencies; continue 

reviewing the faithfulness and consistency of foreign private issuers' IFRS 

financial statements and accompanying reconciliations; identify changes to 

SEC rules that will be necessary upon elimination of reconciliation 

requirements; continue to closely cooperate with CESR and IOSCO 

members on issues including the development of high quality accounting 

standards, consistent application of IFRS, full consideration of international 

counterparts' positions regarding application and enforcement, and the 

avoidance of conflicting regulatory decisions on the application of IFRS and 

US GAAP; and meet with CESR at least semi-annually. 

Continue reviewing the integrity and consistency of foreign private issuers' 

IFRS financial statements and accompanying reconciliations; continue to 

closely cooperate with CESR and IOSCO members on issues including the 

development of high quality accounting standards, consistent application of 

IFRS, full consideration of international counterparts' positions regarding 

application and enforcement, and the avoidance of conflicting regulatory 

decisions on the application of IFRS and US GAAP; and meet with CESR at 

least semi-annually. 

Initiative: Bilateral regulatory dialogues with the Korea Financial Supervisory 

Commission, China Securities Regulatory Commission, Japan Financial Services Agency 

and the European Commission and CESR 

FY 

2005 

FY 

2006 

Plan 

FY 

2006 

Actual 

FY 

2007 

FY 

2008 

Launched dialogues with the China Securities Regulatory Commission and 

Japan Financial Services Agency; ongoing dialogues with the European 

Commission and CESR. 

Launch a dialogue with the Korea Financial Supervisory Commission; 

ongoing dialogues with the China Securities Regulatory Commission, Japan 

Financial Services Agency, and the European Commission and CESR 

(including the adoption of a joint work plan focusing on consistent 

application of IFRS, modernization of disclosure technology, and regulatory 

platforms for risk management). 

Launched a dialogue with the Korea Financial Supervisory Commission; 

adopted the joint work plan with CESR focusing on consistent application of 

IFRS, modernization of disclosure technology, and regulatory platforms for 

risk management. 

Ongoing. 

Ongoing. 

Initiative: All IOSCO jurisdictions to be accepted as signatories or to express a 

commitment to seek legal authority to become signatories to the Multilateral 

Memorandum of Understanding on Enforcement Cooperation and Information-Sharing 

FY 

2005 

Total of 28 jurisdictions accepted as signatories; agreed on target date of 

20 10 for 80 more jurisdictions. 
FY 

2006 

Plan 

FY 

2006 

Actual 

FY 

2007 

FY 

2008 

Total of 34 jurisdictions accepted as signatories. 

Total of 34 jurisdictions accepted as signatories. 

Additional jurisdictions accepted, with progress towards goal of adding 74 

more jurisdictions by 20 10. 

Additional jurisdictions accepted, with progress towards goal of adding 74 

more jurisdictions by 20 10. 

Initiative: IOSCO initiative to raise standards of cross-border cooperation among 

securities regulators in furtherance of the Action Plan to Strengthen Global Capital 

Markets Against Financial Fraud 

FY 

2005 

FY 

2006 

Plan 

FY 

2006 

Actual 

FY 

2007 

FY 

2008 

~dentified and established dialogue with regulators in priority jurisdictions to 

develop a mutual understanding of their willingness and ability to share 

information. 

Ongoing dialogue with regulators in priority jurisdictions; work on 

identifying a second group of priority jurisdictions. 

Ongoing dialogue with regulators in priority jurisdictions; worked on 

identifying a second group of priority jurisdictions. 

To be determined upon receipt and analysis of commitments from priority 

jurisdictions; continue work on identifying a second group of priority 

jurisdictions. 

To be determined upon receipt and analysis of commitments from priority 

jurisdictions. 

Initiative: IOSCO initiative on preservation and repatriation of property in cross-border 

cases 

FY 

2005 

FY 

2006 

Plan 

FY 

2006 

Actual 

Analyzed powers available to regulators and other authorities within a 

jurisdiction to freeze and repatriate assets. 

Support a resolution adopted by IOSCO calling for jurisdictions to examine 

their legal frameworks and strive to develop mechanisms, including 

legislative reform, to freeze assets on behalf of a foreign regulator. 

Supported a resolution by IOSCO calling for jurisdictions to examine their 

legal frameworks and strive to develop mechanisms, including legislative 

reform, to freeze assets on behalf of a foreign regulator; contributed to 

guidance for IOSCO members on procedural and substantive issues related 

to implementation. 
FY 

2007 

FY 

2008 

Issue guidance concerning areas that may affect the design and 

implementation of regulators' and other authorities' mechanisms to freeze 

assets on behalf of a foreign regulator. 

To be determined. 

Initiative: IOSCO initiative on issuer internal control requirements in furtherance of the 

Action Plan to Strengthen Global Capital Markets Against Financial Fraud 

FY 

2005 

FY 

2006 

Plan 

FY 

2006 

Actual 

FY 

2007 

FY 

2008 

Undertook study of issuer internal control requirements in specified 

jurisdictions. 

Contribute to a fact-finding report regarding issuer internal control 

requirements in specified jurisdictions. 

Contributed to fact-finding report regarding issuer internal control 

requirements in specified jurisdictions. 

Continue implementation of recommendations contained in the report and 

consider further work, as appropriate. 

To be determined. 

Initiative: IOSCO initiative on bond market transparency in furtherance of the Action 

Plan to Strengthen Global Capital Markets Against Financial Fraud 

FY 

2005 

FY 

2006 

Plan 

FY 

2006 

Actual 

FY 

2007 

FY 

2008 

Identified best practices for improving bond market transparency. 

Undertake a study of bond market practices and arrive at a preliminary 

assessment of areas for improvement. 

Undertook a study of bond market practices and arrived at a preliminary 

assessment of areas for improvement. 

Contribute to a report on best practices for improving bond market 

transparency. 

Continue implementation of recommendations contained in the report and 

consider further work, as appropriate. 

Initiative: IOSCO initiative on the role of market intermediaries in furtherance of the 

Action Plan to Strengthen Global Capital Markets Against Financial Fraud 

FY 

2005 

FY 

2006 

Plan 

Reviewed the role played by market intermediaries in recent financial 

scandals. 

Complete review of the role played by market intermediaries in recent 

financial scandals; initiate additional work on the topic of information 

management in the context of conflict; and contribute to a discussion paper 

on addressing conflicts of interest. 
FY 

2006 

Actual 

FY 

2007 

FY 

2008 

Completed review of the role played by market intermediaries in recent 

financial scandals; initiated additional work on the topic of information 

management in the context of conflict; and contributed to a discussion paper 

on addressing conflicts of interest. 

Continue work on a discussion paper on addressing conflicts of interest. 

Consider further work, as appropriate. 

FY 2008 Request: In FY 2008, The Commission and staff will continue pursuing a 

number of far-reaching objectives with other regulators designed to improve investor 

protection and strengthen global capital markets. These objectives include continuing 

bilateral regulatory dialogues with the Korea Financial Supervisory Commission, the 

China Securities Regulatory Commission, Japan Financial Services Agency, and the 

European Commission and CESR; closely cooperating with CESR and IOSCO members 

on the development of high quality accounting standards, consistent application of IFRS, 

and the avoidance of conflicting regulatory decisions on the application of IFRS and US 

GAAP; and encouraging IOSCO members to develop mechanisms to assist foreign 

counterparts in freezing assets derived from illegal activity. In addition, OIA will 

continue a dialogue, through IOSCO, with securities regulators in priority jurisdictions to 

raise standards of cross-border enforcement cooperation. Continued progress is expected 

to be made by the 74 IOSCO members that agreed to complete this process by 2010. 
Performance Measure 5 

Percentage of US Households Owning Mutual Funds 

Description: Near record numbers of Americans continue to invest in the US securities 

markets through the purchase and sale of stocks, bonds, and mutual funds. In particular, the 

number and percentage of US households that own mutual funds grew dramatically during the 

1990s as stock and bond mutual finds became a key repository for US savings dollars. The 

percentage of households that own mutual fund shares may reflect, among other things, the 

extent to which the regulatory regime allows for innovation and fosters investor confidence. 

Other factors that may influence short and long term changes in this metric include bull and 

bear markets, technological changes, investor perceptions of industry ethical standards, 

investor reaction to industry marketing efforts, and competition from other financial 

products/services. It is not the goal of the investment management program to promote the 

sale of fund shares. The SEC's strategic goals focus on promoting legal compliance, flexible 

regulation, and informed investors. With these goals in mind, the investment management 

program monitors significant changes in this metric and considers whether such changes may 

signal the need for action to better attain one or more strategic goals. The source of these data 

is the Investment Company Institute. 

FY 

2002 

49.6% 

FY 2008 Request: 52 percent of households owned funds in May 200 1--a cyclical peak that 

reflected in part the extraordinary stock market gains of the late 1990s. Absent a universal 

mandate of a defined contribution retirement plan for all workers, a realistic market 

penetration limit may be 60 percent of households. For example, the 2004 Federal Reserve 

Board Survey of Consumer Finances found that only 56 percent of US households reported 

any savings during the preceding year. The proportion of households owning mutual funds 

held steady in FY 2006 relative to the previous three years. The targets for 2007 and 2008 are 

derived from a rolling ten-year average of this statistic. 

FY 

2003 

47.9% 

FY 

2004 

48.1% 

FY 

2005 

47.5% 

FY 2006 

Plan 

47.1% 

FY 2006 

Actual 

48.0% 

FY 

2007 

48.2% 

FY 

2008 

48.6% 
Performance Measure 6 

Mutual Fund Share of Total Retirement Assets 

Description: The share of total retirement assets held by mutual funds more than tripled 

during the 1990s. Mutual fund share of total retirement assets may indicate investor 

confidence in mutual funds and a flexible regulatory scheme that allows funds to successfully 

compete in the market with other financial institutions. In addition to the factors identified for 

Performance Measure 5 (Percentage of US Households Owning Mutual Funds), other factors 

that may influence short and long term changes in this metric include changes in tax law, 

legislation or rule changes that affect retirement accounts, and the pending transition of baby 

boom generation retirement investments from the accumulation phase to the distribution 

phase. It is not the goal of the investment management program to promote the sale of fund 

shares. The SEC's strategic goals focus on promoting legal compliance, flexible regulation 

and informed investors. With these goals in mind, the investment management program 

monitors significant changes in the mutual fund share of total retirement assets metric and 

considers whether such changes may signal the need for action to better attain one or more 

strategic goals. The source of these data is the Investment Company Institute, and the results 

for each fiscal year reflect data as of December 3 1 of the previous calendar year. 

Performance Measure 7 

Equity Porffolio Holdings of US Investment Companies as a Percentage of Total US 

Stock Market Capitalization 

Description: Investment company holdings of common and preferred stock have accounted 

for an increasing proportion of total US stock market capitalization in recent years. 

Investment company equity holdings now exceed the equity holdings of pension funds. The 

equity portfolio holdings of US investment companies as a percentage of total US stock 

market capitalization may reflect the effectiveness of investment companies as a vehicle for 

capital formation. The source of these data is the US Federal Reserve Flow of Funds 1945- 

2005 from March 9,2006 (Chart L.2 13), and the results for each fiscal year reflect data as of 

December 3 1 of the previous calendar year. 

FY 

2002 

20.9% 

FY 2008 Request: In FY 2006, the percentage of retirement assets held by mutual funds 

reached another new high. The targets for 2007 and 2008 are calculated using a rolling tenyear average of this statistic. For FY 2008, the target is 21.9 percent, which is an increase of 

4.8 percent from FY 2002. 

FY 

2003 

20.2% 

FY 

2002 

19.3% 

FY 

2004 

21.8% 

FY 2008 Request: Investment company equity holdings as a percentage of US stock market 

capitalization again increased significantly in FY 2006. The FY 2007 and 2008 targets are 

derived from a rolling ten year average of this statistic. The target for FY 2008 is 2 1.1 

percent, which represents an increase of 9.3 percent from FY 2002. 

FY 

2004 

20.8% 

FY 

2003 

19.5% 

FY 

2005 

22.6% 

FY 2006 

Plan 

20.3% 

FY 

2005 

23.0% 

FY 

2008 

21.9% 

FY 2006 

Actual 

23.7% 

FY 2006 

Plan 

19.1% 

FY 

2007 

21.2% 

FY 2006 

Actual 

25.1% 

FY 

2007 

20.1% 

FY 

2008 

21.1% 
Goal Three: Foster Informed In vestment Decision Making 

Performance Measure 1 

Percentage of Reporting Corporations and Investment Companies with Disclosures 

Reviewed by the SEC 

Description: The Sarbanes-Oxley Act requires that the SEC review the disclosures of all 

reporting companies and investment company portfolios at least once every three years. 

These reviews help improve the information available to investors and can uncover serious 

violations of the securities laws. 

Corporations 

Investment 

Company Portfolios 

Performance Measure 2 

Percentage of Investment Adviser and Investment Company Transactional Reviews 

Completed Within Timeliness Goals 

Description: For initial registration statements, the SEC's goal is to comment within 30 days 

after they are filed (60 days for registration statements of insurance product separate 

accounts). The SEC also aims to comment on post-effective amendments within 45 days and 

preliminary proxy statements within 10 days after they are filed. 

Initial Registration 

Statements 

Post-Effective 

Amendments 

Preliminary Proxy 

Statements 

FY 2008 Request: The Division of Corporation Finance will meet the requirements of the 

Sarbanes-Oxley mandate by reviewing all current reporting issuers that were not reviewed in 

the prior two fiscal years. This review level is expected to deter fraud in public securities 

transactions and should help ensure that investors receive material information about 

emerging and novel issues. However, the reduced staffing level will result in fewer reviews of 

transactional filings. In addition, review times on filings related to initial public offerings 

(IPOs) may increase if the volume of these filings increases above projected levels. Also, the 

Division of Investment Management anticipates that it will successfully comply with the 

Sarbanes-Oxley Act by reviewing one-third of investment company portfolios in FY 2008. 

FY 

2003 

23% 

10% 

FY 2008 Request: As a benchmark, the staff aims under normal circumstances to provide 

comments within timeliness goals for at least 85 percent of registration statements, 90 percent 

of post-effective amendments, and 99 percent of preliminary proxy statements. 

FY 

2003 

81% 

86% 

100% 

FY 

2004 

22% 

54% 

FY 

2004 

88% 

98% 

100% 

FY 

2005 

50% 

37% 

FY 

2005 

90% 

97% 

100% 

FY 2006 

Plan 

47% 

33% 

FY 2006 

Plan 

85% 

90% 

99% 

FY 

2008 

33% 

33% 

FY 2006 

Actual 

33% 

36% 

FY 2006 

Actual 

88% 

96% 

99% 

FY 

2007 

33% 

33% 

FY 

2007 

85% 

90% 

99% 

FY 

2008 

85% 

90% 

99% 

Performance Measure 5 

Percentage of Forms and Submissions Filed Electronically and in a Structured Format 

Description: The SEC continues to emphasize electronic filing to make information available 

to the public in a format that can be easily obtained and analyzed. The SEC currently has over 

100 forms that must be filed with the agency, which annually generate hundreds of thousands 

of filings. The agency is redesigning its form filing capabilities to rely on more structured 

formats (e.g., information is captured in a comma delimited, XML, XBRL, or other format). 

This measure gauges the percentage of forms that are available to be filed in a structured 

format and the percentage of resulting filings that are received in the structured format. In 

addition, this measure identifies the overall percentage of forms that are in electronic format 

and the overall percentage of resulting filings that are received electronically by the SEC. 

Forms 

Structured format 

Another electronic format 

Total % in electronic format 

Filings Received 

Structured format 

Another electronic format 

Total % in electronic format 

FY 2008 Request: The percentage of the forms that are electronic declined slightly in 

FY 2006; however, that was due to consolidation or elimination of a small number of 

electronic forms rather than an increase in paper forms. Meanwhile, the overall number of 

electronic filings versus paper filings continued to increase. The proportion of forms filed 

with the SEC that are in structured formats such as XBRL increased in FY 2006. However, 

the overall number of structured filings declined slightly in FY 2005 and 2006, due to various 

market dynamics that resulted in fewer being filed in those years. In coming years, the SEC 

will continue to work towards its goal of substantially increasing the percentage of forms and 

submissions in structured format, as well as converting 100 percent of all filings and 

submissions into electronic format. 

FY 

2003 

4% 

68% 

FY 

2004 

4% 

68% 

FY 

2005 

5% 

67% 

72% 

21% 

55% 

76% 

72% 

35% 

54% 

89% 

72% 

36% 

52% 

88% 

FY 2006 

Plan 

7% 

67% 

74% 

36% 

54% 

90% 

FY 2006 

Actual 

8% 

62% 

70% 

35% 

55% 

90% 

FY 

2007 

9% 

67% 

FY 

2008 

13% 

67% 

76% 

36% 

54% 

90% 

80% 

36% 

54% 

90% 
Performance Measure 6 

Number and Percentage of Investor Complaints, Questions, and Requests Completed by 

the Office of Investor Education (OIEA) Within Seven Calendar Days 

Description: OIEA serves the tens of thousands of investors who contact the SEC each year 

with investment-related complaints and questions. A substantial portion of the complaints 

received require input from the entities involved and cannot be resolved in less than 30 to 60 

days. Nevertheless, the staff aims to close out as many new matters as possible within seven 

calendar days. 

Contacts 

Received 

Unique Files 

Opened 

Unique Files 

Closed 

Closed within 7 

Calendar Days 

Percentage 

Performance Measure 7 

OIEA Publications Distributed by the GSA 

Description: OIEA has developed an extensive collection of free information to help 

investors understand the basics of investing, the risks and rewards of various products and 

strategies, the importance of diversification, and ways to find information about brokers, 

advisers, and companies. In addition to posting these materials on the SEC's website, OIEA 

publishes a dozen hard-copy educational brochures. The General Services Administration's 

(GSA) Federal Citizen Information Center (FCIC) serves as one of the most important 

distribution channels for the SEC's most popular English and Spanish publications. 

FY 2008 Request: During FY 2006, OIEA continued its transition to a new correspondence 

management system that no longer records each investor contact as a unique file. As a result, 

the number of new unique files fell despite a slight increase in the volume of investor contacts. 

The percentage of matters closed within seven days remained at 8 1 percent. The staff 

anticipates that proposed enhancements to the new system will increase staff efficiency in FYs 

2007 and 2008. 

FY 

2002 

82,337 

8 1,748 

n/a 

64,8 1 8 

79% 

FY 

2002 

8 1,9 17 

FY 2008 Request: OIEA will continue striving to increase the demand for the SEC's 

educational materials and work closely with GSA's FCIC to distribute hard copies of the 

materials at lower costs. However, the agency's success in achieving this goal is somewhat 

dependent upon use of the SEC's online resources. 

FY 

2005 

476,095 

FY 

2003 

70,574 

7 1,373 

n/a 

58,133 

81% 

FY 

2003 

89,095 

FY 2006 

Plan 

325,000 

FY 

2004 

300,530 

FY 

2004 

73,48 1 

73,4 15 

da 

60,688 

83% 

FY 2006 

Actual 

300,136 

FY 

2005 

76,22 1 

7 1,737 

71,879 

58,443 

81% 

FY 

2007 

300,000 

FY 2006 

Plan 

76,000 

7 1,000 

71,000 

5 8,000 

82% 

FY 

2008 

300,000 

FY 2006 FY FY 

Actual 

77,274 

69,628 

69,507 

56,268 

81% 

2007 , 2008 

77,000 77,000 

70,000 70,000 

69,000 

56,500 

82% 

69,000 

57,000 

83% 
Goal Four: Maximize Use of SEC Resources 

Performance Measure 1 

Staff Turnover Rate 

Description: This measure is determined by dividing the number of employees that leave the 

agency during the fiscal year by the total number of permanent and term employees on board 

at the beginning of the fiscal year. 

Performance Measure 2 

Milestones Achieved on Major Human Capital Initiatives 

Description: The SEC has begun to implement 13 initiatives to support integration of 

human capital systems and improve Human Resources policy development and oversight. 

This measure identifies the range of initiatives and the projects' major milestones. 

Integrated Human Capital Systems: Competency-based performance management 

system 

FY 

2002 

FY 2006 Plan 

FY 2006 Actual 

FY 2007 

FY 2008 

FY 2008 Request: The SEC intends to keep its turnover rate at or below 7 percent in 

FY 2008, consistent with the expected turnover level in FY 2007. The increase in the turnover 

rate in 2006 is largely due to a high number of retirements occumng three years after the 

implementation of the SEC's pay parity authority. The agency is monitoring turnover very 

closely and will work to maintain and build upon its status as one of the top five places to 

work in the federal government (according to the Partnership for Public Service and U.S. 

News & World Report). 

FY 

2004 

6.3% 

FY 

2003 

n/a 

Implemented 

Implement, evaluate, and revise 

Revise and expand 

5.8% 1 5.9% 

FY 

2005 

7.5% 

Integrated Human Capital Systems: Pay for performance and performance 

improvement planning 

FY 2004 

FY 2005 

FY 2006 Plan 

FY 2006 Actual 

FY 2007 

FY 2008 

FY 2006 

Plan 

4% 

Implemented 

Evaluated and expanded 

Evaluate, revise and expand 

Evaluated and revised 

Implement, evaluate, and revise 

Revise and expand 

Integrated Human Capital Systems: Negotiate a new collective bargaining agreement 

FY 

2008 

~7% 

FY 2006 

Actual 

9.1% 

FY 2006 Plan 

FY 2006 Actual 

FY 2007 

FY 2008 

FY 

2007 

-=7% 

Negotiate and implement 

Negotiated 

Negotiate and Implement 

Evaluate 
Integrated Human Capital Systems: SEC University (classroom and online courses) 

FY 2004 

FY 2005 

FY 2006 Plan 

FY 2006 Actual 

FY 2007 

FY 2008 

Implemented 

Expanded 

Evaluate and expand 

Evaluated, revised, and expanded 

Expand, evaluate, and revise 

Evaluate and expand 

Integrated Human Capital Systems: Leadership and management development system 

FY 2006 Actual 

FY 2007 

FY 2008 

Developed 

Develop, implement, and evaluate 

Revise and expand 

Integrated Human Capital Systems: Improve the Office of Human Resources (OHR) 

human capital readiness 

FY 2006 Actual 

FY 2007 

FY 2008 

Implemented 

Implement and evaluate 

Evaluate, revise, and expand 

Integrated Human Capital Systems: Knowledge management framework 

FY 2006 Actual 

FY 2007 

FY 2008 

Developed 

Continue development 

Implement and evaluate 

Integrated Human Capital Systems: Marketing of OHR programs 

FY 2006 Actual 

FY 2007 

FY 2008 

Developed 

Implement and evaluate 

Revise and expand 

Integrated Human Capital Systems: Workforce planning system 

FY 2006 Actual 

FY 2007 

FY 2008 

Developed 

Continue development and implement 

Evaluate, revise, and expand 

Integrated Human Capital Systems: Human capital measurement model 

FY 2006 Actual 

FY 2007 

FY 2008 

Developed 

Implement 

Evaluate and revise 

Integrated Human Capital Systems: National recruitment plan 

FY 2006 Actual 

FY 2007 

FY 2008 

Developed 

Continue development and implement 

Evaluate and revise 
HR Policy Development and Oversight: Optimize the use of AWE 

FY 2004 

FY 2005 

FY 2006 PIan 

FY 2006 Actual 

FY 2007 

FY 2008 

Implemented 

Evaluated 

Evaluate 

Evaluated and expanded 

Expand and evaluate 

Evaluate and revise 

HR Policy Development and Oversight: Employee Benefits Information System 

(EBIS) 

FY 2006 Actual 

FY 2007 

FY 2008 

Implemented 

Evaluate 

Revise and expand 

HR Policy Development and Oversight: Pay and benefits revision 

FY 2004 

FY 2005 

FY 2006 Plan 

FY 2006 Actual 

FY 2007 

FY 2008 

Implemented 

Evaluated 

Expand 

Evaluated and expanded 

Evaluate and expand 

Evaluate 

HR Policy Development and Oversight: Administrative Officers' professional 

development 

FY 2006 Actual 

FY 2007 

FY 2008 

Implemented 

Continue implementation and expand 

Evaluate and revise 

HR Policy Development and Oversight: Enterprise telework program 

FY 2004 

FY 2005 

FY 2006 Plan 

FY 2006 Actual 

FY 2007 

FY 2008 

Implemented 

Evaluated 

Expand 

Expanded 

Expand and evaluate 

Expand and evaluate 

HR Policy Development and Oversight: Intranet program guidance 

FY 2006 Actual 

FY 2007 

FY 2008 

Developed 

Implement, evaluate, and revise 

Expand and revise 
HR Policy Development and Oversight: Process improvement and quality control 

system 

FY 2006 Actual 

FY 2007 

FY 2008 

Performance Measure 3 

Percentage of IT Projects that Adhere to the SEC's Capital Planning and Investment 

Committee (CPIC) Process 

Description: The SEC has information technology capital planning committees designed to 

ensure that IT projects are appropriately evaluated and considered. A corresponding CPIC 

process is being refined to ensure that IT projects are effectively managed, completed on time, 

and within budget. This measure identifies the percentage of IT projects that adhere to the 

agency's CPIC process. 

Developed 

Implement and evaluate 

Revise and expand 

FY 2008 Request: The SEC will continue to evaluate, revise, and expand its human 

capital initiatives in FY 2008, building on results from FYs 2006 and 2007 to refine the 

programs and services as needed. 

FY 

2004 

100% 

FY 2008 Request: The SEC will continue to vigorously manage its portfolio of IT 

investments in accordance with the SEC's CPIC process. Strengthened CPIC process controls 

have resulted in better oversight and management of the SEC's IT investment portfolio. 

FY 

2005 

90% 

FY 2006 

Plan 

100% 

FY 2006 

Actual 

97% 

FY 

2007 

FY 

2008 

90% I 95% 
Performance Measure 4 

Milestones Achieved on Major IT Projects 

Description: The SEC is focusing its IT investments in five primary areas to enhance program 

effectiveness and operational efficiencies. A variety of projects are being planned or 

implemented in these areas that range in complexity and duration (e.g., some may be completed 

in a single fiscal year while others span multiple fiscal years). This measure identifies the range 

of initiatives and the projects' major milestones. 

Project 

FY 

2005 

EDGAR/Disclosure: 

FY 2006 

Plan 

Modify EDGAR to 

accommodate interactive 

data in XBRL format for 

financial reports 

Transition EDGAR system 

management to new 

contract 

Enhance SEC.gov to 

improve EDGAR data 

searches and accessibility 

for investors 

FY 2006 

Actual 

Initiated 

Initiated 

Initiated 

Enforcement/Examination Activities: 

FY 

2007 

In 

Progress 

Complete 

In 

Progress 

Image backlog of paperbased discovery documents 

Provide fully automated 

processing of options trade 

records in support of 

enforcement investigations 

Redesign the enforcement 

case management system to 

improve management of 

penalties and disgorgements 

Upgrade analytical tools 

available to examiners 

FY 

2008 

In 

Progress 

In 

Progress 

In 

Progress 

In 

Progress 

In 

Progress 

Initiated 

Initiated 

Internal Productivity: 

Implement 

Complete 

w 

Implement new systems to 

support expansion of 

telework 

Implement new 

procurement and 

budget ing/perforrnance 

management systems 

Ongoing 

Enhancement 

Complete 

I 

Complete 

Complete 

Complete 

Complete 

In 

Progress 

In 

Progress 

In 

Progress 

Completed 

In 

Progress 

In 

Progress 

Security/Disaster Recovery: 

In 

Progress 

Initiated 

Implement Ongoing 

Enhancement 

Complete 

In 

Progress 

Completed 

In 

progress Implement Complete 

Other Indicators Related to SEC Activities 

Indicator 1 

Number and Percentage of Examinations Finding 'Significant" Deficiencies 

Description: Examiners find a wide range of deficiencies during examinations. Some of 

these deficiencies are more technical in nature, such as failing to include all information that is 

required to be in a record. Other deficiencies may have caused harm to customers or clients of 

a firm, had a high potential to cause harm, reflect recidivist misconduct, or a serious emerging 

compliance risk. These latter deficiencies are among those categorized by the staff as 

"significant." This measure was first implemented in FY 2005 and data is not available for 

prior years. The staff expects to continue to refine the factors that are used to measure the 

significance of examination findings. , 

FundAdviser Exams 

Number 

Percent 

Broker/Dealer Exams 

Number 

Percent 

Discussion: Examiners continued to use risk-assessment techniques to focus examinations on 

areas most likely to reveal significant compliance issues. Examples of significant findings 

include situations in which examinations found violations that were the same as those found in 

a previous exam, which resulted in a referral to an SRO or the Division of Enforcement for 

investigation or which resulted in corrective action by the firm, such as funds being 

reimbursed to affected investors. 

FY 2005 

769 

37% 

35 1 

48% 

FY 2006 

648 

39% 

297 

40% 

Indicator 4 

Assets Frozen Abroad as a Result of SEC Coordination with Foreign Regulators 

Description: In order to effectively enforce compliance with federal securities laws and in 

support of enforcement cases filed domestically, the SEC works closely with foreign 

regulators, law enforcement agencies, and courts to locate ill-gotten proceeds that have been 

transferred overseas and freeze the accounts in which they are located. Violators are detected 

and their assets are seized so that they cannot benefit from this activity. 

Assets Frozen Abroad 

(in millions) 

Discussion: The SEC cannot project future estimates for this indicator because it is 

impossible to predict the extent to which violators will move their ill-gotten proceeds to 

foreign jurisdictions. The SEC does anticipate that its efforts to freeze assets abroad will 

increase as international cooperation on enforcement matters develops around the globe. 

FY 2005 

$15.3 

FY 2006 

$20.7