U.S. Securities and 

Exchange Commission

FY 2012 Congressional Justification 

In Brief

February 2011
U.S. Securities and Exchange Commission

TABLE OF CONTENTS

Subject Page

Executive Summary 1

Tables 

FTE and Positions by Program 9

Obligations by Object Class 10

FY 2012 Request by Strategic Goal and Program 11

Summary of Changes 12

Offsetting Collections and Spending Authority 13

Appropriations Language 14

Request by Strategic Goal

FY 2012 Request by Strategic Goal 15

Goal 1: Foster and Enforce Compliance with Federal Securities Laws 18

Goal 2: Establish an Effective Regulatory Environment 28

Goal 3: Facilitate Access to the Information Investors Need to Make

 Informed Decisions 35

Goal 4: Maximize the Use of SEC Resources 41

Request by Program

Division of Enforcement 49

Office of Compliance Inspections and Examinations 50

Division of Corporation Finance 51

Division of Trading and Markets 52

Division of Investment Management 53

Division of Risk, Strategy and Financial Innovation 54

Office of the General Counsel 55

Other Program Offices 56

Office of Chief Accountant 57

Office of Investor Education and Advocacy 58

Office of International Affairs 59

Office of the Administrative Law Judges 60

Office of the Investor Advocate 61

Office of Credit Ratings 62

Office of Municipal Securities 63

Agency Direction and Administrative Support 64

Agency Direction 65

Office of the Executive Director 66

Office of the Chief Operating Officer 67

Office of Minority and Women Inclusion 68

Office of Equal Employment Opportunity 69

Office of the Inspector General 70

Appendix A-Acronyms 71
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EXECUTIVE SUMMARY

The U.S. Securities and Exchange Commission (SEC) is pleased to submit this budget request for 

fiscal year (FY) 2012 to support the agency’s work to protect investors, maintain fair, orderly, and 

efficient markets, and facilitate capital formation. This request would provide the agency the 

funds necessary to carry out its core mission, as well as the new responsibilities assigned to the 

agency by the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).

Over the past two years, the SEC has taken significant steps to make the SEC more vigilant, agile, 

and responsive, and is moving on multiple fronts to enhance its effectiveness and provide robust 

oversight of the financial markets. The agency has new senior leadership in key positions and has 

embarked on a vigorous rulemaking agenda, addressing areas such as equity market structure, 

credit rating agency conflicts and disclosure, investment adviser custody controls, money market 

fund resiliency, asset-backed securities, large trader reporting, pay-to-play, and municipal 

securities disclosure. 

The SEC is also reforming how it operates. For instance, the enforcement division streamlined its 

procedures to bring cases more swiftly, removed a layer of management, created specialized units, 

and added new staff with new skills to pursue fraud and penalize wrongdoers. The enforcement 

program is generating tangible results, as evidenced by both the number and complexity of recent 

actions. In addition, in FY 2010, the SEC returned $2.2 billion to harmed investors, twice the 

agency’s budget for that year. 

Additionally, after a top-to-bottom review, the agency’s examinations unit restructured its exam 

program, becoming more risk-based in its approach, enhancing staff training and installing better 

systems to support examiners. Further, the SEC has continued to invest in modernizing its 

systems, including a centralized system for tips and complaints, enforcement and examination 

management systems, risk analysis tools, and financial management systems. 

Current Challenges

FY 2011 and FY 2012 mark a critical period for the agency. Not only does the Dodd-Frank Act 

create significant additional work for the SEC, both in the short and long term, but the agency 

must continue to carry out its longstanding core responsibilities. These responsibilities —

pursuing securities fraud, reviewing public company disclosures and financial statements, 

inspecting the activities of investment advisers and broker-dealers, and ensuring fair and efficient 

markets—remain an essential ingredient to restoring investor confidence and trust in financial 

institutions and markets following the recent financial crisis.

Until recent years, the SEC has faced significant challenges in maintaining a staffing level and 

budget sufficient to carry out its core mission. The SEC experienced three years of frozen or 

reduced budgets from FY 2005 to 2007 that forced a reduction of 10 percent of the agency’s staff. 

Similarly, the agency’s investments in new or enhanced IT systems underwent a decline of about 

50 percent from FY 2005 to 2009. 

SEC staffing levels are just now returning to the level of FY 2005, despite the fact that the size 

and complexity of the securities markets have undergone tremendous growth since then. During 

the past decade, trading volume has more than doubled, the number of investment advisers grew 

by 50 percent, and the funds they manage have increased to $38 trillion. A number of financial 
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firms spend many times more each year on their technology budgets alone than the SEC spends 

on all of its operations.

Today, the SEC is responsible for overseeing approximately 35,000 entities, including 11,800 

investment advisers, 9,500 public companies, 4,200 mutual funds, and 5,400 broker-dealers with 

175,000 branch offices. The SEC also oversees 600 transfer agents, 12 national securities 

exchanges, 10 clearing agencies, 10 nationally recognized statistical ratings organizations 

(NRSROs), as well as the Public Company Accounting Oversight Board (PCAOB), Financial 

Industry Regulatory Authority (FINRA), Municipal Securities Rulemaking Board (MSRB), and 

other self-regulatory organizations (SROs). Six years ago, the SEC’s funding was sufficient to 

provide 19 examiners for each trillion dollars in investment adviser assets under management. 

Today, that figure stands at 12 examiners per trillion dollars. 

The enactment of the Dodd-Frank Act has added significantly to the SEC’s workload. The law 

represents the most sweeping changes to the nation’s securities laws in decades. In the short 

term, the Dodd-Frank Act requires the SEC to promulgate more than 100 new rules, create five 

new offices, and conduct more than 20 studies and reports. The law also assigns the SEC 

additional responsibilities that will have a considerable long-term impact on the agency’s resource 

needs. These new responsibilities include: oversight of the over-the-counter derivatives market 

and hedge fund advisors; registration of municipal advisors and security-based swap participants; 

enhanced supervision of NRSROs and clearinghouses; greater disclosure and risk retention 

regarding asset-backed securities; and creation of a new whistleblower program. In 

acknowledgement of this significant new workload, the Act authorized an increase in the agency’s

budget from the $1.11 billion appropriated in FY 2010 to $1.3 billion in FY 2011, $1.5 billion in 

FY 2012, and $2.25 billion by FY 2015. 

So far, the SEC has proceeded with the first stages of implementation of the Dodd-Frank Act 

without additional funding. This has largely involved performing studies, analysis, and the 

writing of rules. These tasks have taken staff time from other responsibilities, and has been done 

almost entirely with existing staff and without additional expenses in areas such as information 

technology. 

FY 2012 Request

The SEC is requesting $1.407 billion for FY 2012. This represents an increase of $264 million 

over the agency’s current FY 2011 spending authority, and will support 4,827 positions (4,460 

FTE), an increase of 780 positions (612 FTE) over projected FY 2011 levels. The FY 2012 

request is designed to provide the SEC with the resources required to achieve multiple, highpriority goals: adequately staff the agency to fulfill its core mission of protecting investors, 

maintaining orderly and efficient markets, and facilitating capital formation; continue to 

implement the Dodd-Frank Act; and expand the agency’s information technology (IT) systems 

and management infrastructure to serve the needs of a more modern and complex organization.
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Offsetting Collections

It is important to note that the SEC’s FY 2012 funding request will be fully offset by matching 

collections of fees on securities transactions. Currently, the transaction fees collected by the SEC 

are approximately two cents per $1,000 of transactions. Under the Dodd-Frank Act, beginning 

with FY 2012, the SEC is required to adjust fee rates so that the amount collected will match the 

total amount appropriated for the agency by Congress. Under this mechanism, SEC funding will 

be deficit-neutral, as any increase or decrease in the SEC’s budget would result in a 

corresponding rise or fall in offsetting fee collections. 

Reinvigorating Core SEC Programs

Of the new positions requested for FY 2012, 312 positions (40 percent) will be used to strengthen 

and support core SEC operations and to continue reforming its operations and fostering stronger 

protections for investors. Most notably, the enforcement program would add 28 positions to 

strengthen its new Office of Market Intelligence that conducts risk assessment and handles the 

thousands of tips, complaints, and referrals the agency receives each year; expand the program’s 

five new specialized investigative units; and bolster its litigation program. The SEC also would 

hire 55 new personnel in its examination program to augment its risk assessment, monitoring, and 

surveillance functions and conduct additional adviser and fund inspections. An additional 37 staff 

would be added to the Division of Corporation Finance, primarily to conduct more frequent 

disclosure reviews of the largest companies, and 15 staff would be hired into the Division of 

Investment Management primarily to enhance oversight of money market funds and specialized 

products. 

Implementation of the Dodd-Frank Act

The other 468 positions (60 percent) of the new positions requested for FY 2012 are necessary 

initially to implement the Dodd-Frank Act. The agency also will invest in technology to facilitate 

the registration of additional entities and capture and analyze data on the new markets. The costs 

of these new positions and technology investments will be approximately $123 million. Many of 

these new positions will be for experts in derivatives, hedge funds, data analytics, credit ratings, 

and other new or expanded responsibility areas. The new positions will support important new 

responsibilities including:

• Derivatives -- 157 positions focused on the derivatives markets, including 47 staff in the 

Division of Trading and Markets to develop programs to oversee over-the-counter 

derivatives, 34 examination staff to inspect for compliance, and 43 enforcement staff. 

• Hedge Funds -- 102 positions focused on compliance with the new rules for hedge fund 

advisors, including 45 examination staff, 21 enforcement staff, and 15 assigned to the 

Divisions of Investment Management and Risk, Strategy, and Financial Innovation. 

• Oversight -- 50 positions to support implementation of various requirements with respect 

to investment advisers and broker-dealers (16 positions), review of SRO rule filings (11 

positions), PCAOB oversight (9 positions), asset-backed securities (8 positions), and 

corporate governance (6 positions). 

• Whistleblower -- 43 positions focused on the whistleblower program, principally to 

expand investigations of tips received from whistleblowers. 
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• Municipal Securities -- 35 positions focused on municipal securities, principally to 

conduct examinations of newly-registered municipal advisors and to build the new Office 

of Municipal Securities.

• Clearing -- 33 positions focused on the Act’s new responsibilities with respect to clearing, 

including annual reviews of systemically important agencies, including 20 examination 

staff and 12 staff in the Division of Trading and Markets.

• Credit Rating Agencies -- 26 positions focused on NSRSOs, principally for the Office of 

Credit Ratings to perform the annual examinations required by the Act.

It should be noted that, in addition to the new positions requested in FY 2012, the SEC also 

anticipates that an additional 296 positions will be required in FY 2013 for full implementation of 

the Dodd-Frank Act. 

Program Details

This section provides additional details of the SEC’s overall FY 2012 request as it relates to 

certain key agency divisions, offices, and programs.

Enforcement 

To maintain an effective investigative capacity and deterrent presence, the SEC’s enforcement 

program must be adequately staffed to address increasingly complex financial products and 

transactions, handle the increasing size of the markets, take prompt action to halt violations, and 

recover funds. The SEC’s budget request for FY 2012 will support a total of 1,432 positions 

(1,366 FTE) for the agency’s enforcement program, which represents an increase of 156 positions 

(122 FTE) above FY 2011 levels. This will permit the SEC to initiate 125 additional inquiries, 

conduct 100 additional formal investigations, and file charges in 70 additional civil or 

administrative cases. The new positions include:

• 28 positions to strengthen the intelligence analysis function, including the new Office of 

Market Intelligence, created in 2010 to manage the collection, analysis, triage, referral, 

and monitoring of the thousands of tips, complaints, and referrals that the SEC receives 

each year; 

• 92 new positions committed to expanding and focusing the investigations process, for 

which the Government Accountability Office (GAO) identified an 11 percent staff 

reduction between FY 2004 and FY 2008; and 

• 36 positions to reinforce the proceedings function, including trial lawyers and support for 

bringing enforcement cases in federal court or in administrative proceedings.

Many of these new positions are designed to strengthen core agency functions. The Dodd-Frank 

Act is also expected to require additional workload. For example, the enforcement workload is 

likely to increase as a result of the increased number and types of market participants, increased 

complexity of investigations, and the law’s whistleblower-reward program.
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Examinations

The SEC’s examination program is responsible for examining the activities and operations of 

investment advisers, broker-dealers, and other key securities market participants for compliance 

with federal law and agency regulations. The SEC’s budget request for FY 2012 will support a 

total of 1,097 positions (1,002 FTE) for the national examination program, which represents an 

increase of 195 positions (145 FTE) from FY 2011 levels. These resources are critically needed 

to address the growing disparity between the number of exam staff and the growing size and 

complexity of registered firms, which include investment advisers, broker-dealers, mutual funds, 

and SROs, among others. For example, in FY 2010, the agency was only able to examine nine 

percent of registered investment advisers. Forty of the new positions requested for FY 2012 will 

be used to enhance general oversight of investment managers and broker-dealers, and especially 

to improve overall coverage of registered advisers and investment company complexes. 

The budget request also will support the agency’s efforts to further develop a robust risk-based 

approach to examinations. Twelve new positions in FY 2012 will be used to improve 

surveillance and risk identification/assessment capabilities and the targeting of exams to areas and 

firms that present the greatest risk of harm to investors and the markets.

The examination program also has significant responsibilities with respect to administering the 

Dodd-Frank Act. The FY 2012 budget request will permit the following new positions to be 

added to the examination program in the following areas:

• 34 positions to examine the more than 1,000 new entities and thousands of individuals 

expected to register as municipal advisors;

• 34 positions to examine newly-registered security-based swap participants, including 

dealers and execution facilities; 

• 45 positions to examine the estimated 750 private fund advisers who are expected to 

register with the Commission;

• 20 positions to provide expanded oversight of clearing agencies, including annual reviews 

of systemically important agencies; and 

• 7 positions to execute additional exam responsibilities with respect to FINRA and the 

PCAOB.

Trading and Markets

The Division of Trading and Markets is responsible for supervising the major securities market 

participants, including 5,400 broker-dealers, 12 securities exchanges, 10 clearing agencies, 600 

transfer agents, and FINRA and other SROs. The SEC’s budget request for FY 2012 will support 

a total of 301 positions (272 FTE) for Trading and Markets, an increase of 80 positions (60 FTE) 

above FY 2011. These additional resources will provide more robust oversight in several areas 

where the recent financial crisis has identified the need for improved regulation, and to respond to 

the significant increase in registrants subject to the division’s scope of responsibilities.

Fifty-six of the new positions will be used to carry out the division’s responsibilities regarding 

supervision of the U.S. securities markets, including clearance and settlement, market 

supervision, derivatives policy and trading practices, and market operations. Among other things, 

the new positions will permit examination of issues related to changes in the exchange and over-
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the-counter markets for securities, including market structure developments, such as growth of 

high-frequency trading, dark liquidity, and the potential for excessive market volatility. The new 

positions also will permit evaluation and review of the increased number of SRO proposed rule 

changes and to expedite the review of SRO rule filing in accordance with Dodd-Frank Act 

requirements.

The remaining 24 new positions will be allocated to improve supervision of securities firms to 

meet the anticipated challenges posed by the increase in regulated entities and by new initiatives 

required by the Dodd-Frank Act. Among other things, the new positions will have 

responsibilities with respect to the regulation of security-based swap intermediaries, financial 

responsibility of broker-dealers and security-based swap intermediaries, and to modernize the 

agency’s transfer agent regulations. The new positions will also permit added supervision of the 

Securities Investor Protection Corporation (SIPC) and monitoring of the liquidation of 

broker-dealers under the Securities Investor Protection Act of 1970.

The division is also responsible for leading the agency’s efforts to coordinate certain critical 

interagency projects, including the designation of systemically important non-bank financial 

entities and financial market utilities under the auspices of the Financial Stability Oversight 

Council (FSOC) and mechanisms for the orderly liquidation of broker-dealers under the new 

liquidation authority afforded to FSOC and the Federal Deposit Insurance Corporation. 

Public Company Disclosure

The Division of Corporation Finance is responsible for overseeing corporate disclosure of 

important information to the investing public. The SEC’s budget request for FY 2012 will 

support a total of 539 positions (or 503 FTE) for Corporation Finance, an increase of 50 positions 

(38 FTE). These resources will be used to broaden the scope and frequency of reviews, increase 

its focus on large and financially significant registrants, and conduct an in-depth review of core 

disclosure requirements.

Forty of these new positions will be used to enhance the division’s disclosure review program, 

which is responsible for reviewing approximately 4,000 corporate filings annually. These 

resources will permit an increase in the scope and frequency of the division’s reviews of public 

company filings made by large and financially significant companies, without compromising the 

quality and frequency of filing reviews for small and mid-sized companies. The resources will 

also permit enhanced review of offering documents and asset-backed and other structured finance 

offerings.

The division also has significant rulemaking responsibilities, including with regard to general 

disclosure requirements applicable to public companies, beneficial ownership reporting rules, and 

disclosure requirements for complex financial instruments such as asset-backed securities. The 

remaining 10 positions will be used to strengthen the division’s rulemaking and interpretive 

advice capabilities. This will permit an in-depth review of core disclosure requirements to ensure 

that they reflect contemporary business practices and address the needs of modern investors, and 

to permit additional analysis with respect to proxy voting, shareholder communication, beneficial 

ownership reporting, and disclosures of credit rating information. It will also permit the division 

to adequately respond to anticipated requests for interpretation and guidance, including with 

respect to shareholder director nominations and shareholder proposals.
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Investment Management

The Division of Investment Management oversees the SEC’s efforts to minimize the financial 

risks to investors from fraud, mismanagement, self-dealing, and misleading or incomplete 

disclosure in the investment company and investment adviser segments of the financial services 

industry, without imposing unnecessary costs and burdens on regulated entities. The SEC’s 

budget request for FY 2012 will support a total of 193 positions (181 FTE) for Investment 

Management, an increase of 31 positions (23 FTE). These additional resources will permit more 

robust oversight in several areas where the recent financial crisis has identified the need for 

improved regulation.

Four of the new positions will be used to improve monitoring of money market funds, which hold 

approximately $3 trillion in assets, including about one-fifth of U.S. households’ cash balances. 

These positions will be used to improve surveillance and perform additional analysis of expanded 

monthly portfolio holdings data that the agency began to collect in FY 2011. Seven other

positions will be used to deepen the division’s expertise with respect to specialized products. 

Sixteen new positions will be used to carry out duties required by the Dodd-Frank Act, including 

rulemaking and addressing interpretive issues relating to investment adviser regulation, 

registration and reporting by advisers to private investment funds, and systemic risk reporting. 

These positions will also be used to inaugurate a program within the division to conduct 

compliance inspections and examinations of investment companies and investment advisers, as 

required under the Dodd-Frank Act. 

Setting Priorities Based on Risk 

In FY 2009, the SEC established the Division of Risk, Strategy and Financial Innovation to better 

equip the agency to identify and address emerging risks and long-term issues of critical 

importance. The SEC’s budget request for FY 2012 will support a total of 96 positions (86 FTE), 

an increase of 32 positions (24 FTE), to permit the agency to build a deeper reservoir of experts 

who can conduct risk and economic analysis, spot emerging trends and practices, and ensure that 

considerations pertaining to risk are better integrated into all aspects of agency decision-making. 

The agency’s need to hire more professionals with significant knowledge and expertise in 

financial markets and products expertise has been highlighted in independent reviews by the GAO 

and the SEC’s Office of Inspector General (OIG).

Information Technology Systems

Data management and analysis is critical in identifying and assessing potential risk to the agency 

and the U.S. financial markets. The recent growth in the size and technological complexity of the 

U.S. markets requires that the SEC leverage its own technology to identify and address the most 

significant threats to investors, as well as to continuously improve agency productivity. 

The SEC’s budget request for FY 2012 will support information technology investments of $78 

million, an increase of $23 million over FY 2011. This will help to address the technology gap 

that resulted between FY 2005 and 2009, when SEC investments in new IT systems dropped by 

more than half. This level of funding is needed to support critical new technology initiatives, 

including data management and integration, document management, EDGAR modernization, 

market data, internal accounting and financial reporting, infrastructure functions, and improved 

project management. This funding also will permit the agency to develop risk analysis tools to 

assist with triage and analysis of the thousands of tips, complaints, and referrals received 
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annually, and to complete a digital forensics lab that enforcement staff can use to recreate data 

from computer hard drives and cell phones to catch sophisticated fraudsters. This request also 

includes funding for technology needed to facilitate the registration of additional entities required 

by the Dodd-Frank Act and to capture and analyze data on these new markets. 

To execute these additional IT investments, the SEC’s budget for FY 2012 allocates 182 positions 

(137 FTE) for the Office of Information Technology, an increase of 60 positions

(20 FTE) over FY 2011 levels. This includes the hiring of experienced business analysts and 

certified project managers to oversee IT projects, support for modernization of enforcement and 

examination systems and redesign of the EDGAR system, and staff to address financial statement 

and information technology deficiencies identified by GAO.

New SEC Offices

The Dodd-Frank Act requires the SEC to establish five new offices—the Office of Credit Ratings; 

Office of the Investor Advocate; Office of Minority and Women Inclusion; Office of Municipal 

Securities; and Office of Whistleblower Protection. The SEC has taken action to establish the 

Office of Whistleblower Protection as part of the Division of Enforcement. Creation of the other 

four offices, because they are required to report directly to the SEC Chairman, is subject to 

reprogramming approval by the House and Senate Appropriations Committees. If 

reprogramming approval is granted, the SEC plans to initially establish the five new offices in FY 

2011 with 31 staff members, principally by transferring existing staff from other offices or 

functions. For FY 2012, the SEC is requesting 33 additional positions to staff these offices at 

adequate levels, including 24 within the Office of Credit Ratings to carry out the requirement to 

conduct annual examinations of all 10 NRSROs. Additionally, the budget request will permit 

seven new positions to be established within the Office of Minority and Women Inclusion and 

new positions in the Office of the Investor Advocate and the Office of Municipal Securities. 

Managing Agency Resources

In FY 2012, the SEC will continue to make additional improvements to the agency’s basic 

internal operations—the processes that guide its work, support its infrastructure, and determine 

how it is organized. The budget request envisions a strengthening of the Office of the Chief 

Operating Officer, newly established in FY 2010, including support for initiatives to develop a 

more robust operational risk management program and to build a data management program 

under the agency’s new Chief Data Officer. The budget request also contemplates an appropriate 

expansion of the agency’s administrative support functions, including the Offices of Financial 

Management, Human Resources, Administrative Services, and FOIA and Records Management. 

The agency’s budget also includes the necessary space rent and other non-compensation expenses 

necessary to support the level of staffing requested for FY 2012. Additionally, the SEC is 

devoting significant management attention to improving program and management controls, 

including in response to audits and assessments by the OIG, GAO, and management’s own 

internal assessments. In general, these investments are intended to bring these administrative and 

support services capabilities into alignment with the requirements of today’s SEC, and ensure that 

the agency manages its resources wisely and efficiently. 
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FTE and Positions by Program

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE Positions FTE Positions FTE Positions

Enforcement 1,173 1,398 1,236 1,276 1,366 1,432

Compliance Inspections and Examinations 854 945 854 902 1,002 1,097

Corporation Finance 470 516 465 489 503 539

Trading and Markets 191 231 214 221 272 301

Investment Management 157 175 157 162 181 193

Risk, Strategy and Financial Innovation 47 82 60 64 86 96

General Counsel 139 159 145 150 163 173

Other Program Offices

 Chief Accountant 55 65 52 54 57 60

 Investor Education and Advocacy 71 80 45 45 53 56

 International Affairs 34 37 36 41 46 53

 Administrative Law Judges 10 12 10 10 11 11

 Investor Advocate 0 0 3 5 6 6

 Credit Ratings 0 0 5 11 28 35

 Municipal Securities 0 0 2 4 5 5

 Total 170 194 153 170 206 226

Agency Direction and Administrative Support

 Executive Staff 38 41 41 42 43 44

 Public Affairs 7 10 5 5 6 7

 Secretary 41 46 28 29 29 31

 Executive Director 10 11 8 10 9 13

 Financial Management - Budget and Planning 10 14 12 12 14 15

 Human Resources 63 83 75 79 98 108

 Administrative Services 93 114 105 108 119 125

 Chief Operating Officer 0 1 4 4 11 14

 Financial Management - Accounting and Finance 50 70 57 61 63 67

 Information Technology 125 155 116 122 137 182

 FOIA/Records Management 1 3 41 43 44 47

 Minority and Women Inclusion 0 0 3 3 8 10

 Equal Employment Opportunity 8 10 7 7 8 9

 Total 446 558 502 525 589 672

Inspector General 17 21 18 21 20 24

Total FTE and Positions 3,748 4,363 3,848 4,047 4,460 4,827

 Permanent 3,664 4,279 3,804 3,980 4,388 4,753

 Temporary 84 84 44 67 72 74
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Obligations by Object Class

($ in thousands)

FY 2010 FY 2011 FY 2012

Actual * CR Request

Personnel Compensation & Benefits

 Total Personnel Compensation (11.9) $557,417 $590,525 $693,426

Full-time Permanent (11.1) 546,737 585,257 678,727 

Other than Full-time Permanent (11.3) 4,388 2,530 4,936 

Other Personnel Compensation (11.5) 6,292 540 7,510 

 Civilian Personnel Benefits (12.1) 154,879 154,912 185,468 

Subtotal Cost of Salaries $712,296 $745,437 $878,894

Other Expenses

 Benefits for Former Personnel (13.0) 2,209 809 820 

 Travel and Transportation of Persons (21.0) 12,327 10,882 17,480 

 Transportation of Things (22.0) 117 92 93 

 Rent, Communications & Utilities (23.0) 102,581 120,138 186,617 

Rental Payments to Others (23.2) 91,613 107,515 171,967 

Comm., Utilities, and Misc. Charges (23.3) 10,968 12,623 14,650 

 Printing and Reproduction (24.0) 8,012 6,596 8,600 

 Other Contractual Services (25.0) 185,639 186,375 222,386 

Advisory and Assistance Services (25.1) 43,257 42,023 55,808 

Other Services (25.2) 47,531 49,021 59,627 

Purchase of Goods & Services from 

 Government Accounts (25.3) 8,193 8,659 8,780 

Operation & Maintenance of Facilities (25.4) 9,790 8,000 8,112 

Operation & Maintenance of Equipment (25.7) 76,868 78,672 90,059 

 Supplies and Materials (26.0) 2,894 2,896 3,307 

 Equipment (31.0) 61,238 49,980 59,319 

 Building Alterations (32.0) 11,524 20,650 29,967 

 Claims and Indemnities (42.0) 1,291 0 0 

 Refunds (44.0) 102 0 0 

 Undistributed (92.0) 1,317 0 0 

Subtotal Cost of Other Expenses $389,251 $398,418 $528,589

Spending Authority $1,101,547 $1,143,855 $1,407,483

*FY 2010 includes $7,753 from the $10,000 supplemental appropriation the SEC received in July 2009 (P.L. 111-32).

Average Salary and Grade 1/

FY 2010 FY 2011 FY 2012

Actual CR Request

Average SO Salary $232,788 $232,788 $232,788

Average SK Salary $150,414 $151,514 $155,302

Average SK Grade 14 14 14

1/ Average salary as of the last day of the fiscal year.
FY 2012 Request by Strategic Goal and Program

($ in thousands)

FY 2012 Request

Change over Change over

FY 2010 FY 2011

Actual * CR

Goal 1 Goal 2 Goal 3 Goal 4

Enforce Effective Facilitate Align &

FY 2010 FY 2011 Securities Regulatory Access Manage FY 2012

SEC Program Actual * CR Laws Environ. To Info. Resources Request $ % $ %

FY 2010 Actual * $681,695 $104,047 $181,607 $134,198

FY 2011 CR $705,171 $111,773 $185,446 $141,465

Enforcement $361,650 $384,660 $455,726 $0 $0 $0 $455,726 $94,076 26 $71,066 18

Compliance Inspections

 and Examinations 238,470 240,002 303,858 0 0 0 303,858 65,388 27 63,856 27

Corporation Finance 135,135 137,042 3,156 20,515 134,137 0 157,808 22,673 17 20,766 15

Trading and Markets 55,655 61,677 14,398 45,734 24,561 0 84,693 29,038 52 23,016 37

Investment 

Management 49,985 50,969 14,971 29,318 18,090 0 62,379 12,394 25 11,410 22

Risk, Strategy, and 

Financial Innovation 19,862 21,330 9,665 15,588 3,429 2,494 31,176 11,314 57 9,846 46

General Counsel 43,132 44,540 33,893 8,473 1,589 9,002 52,957 9,825 23 8,417 19

Other Program Offices 49,194 49,742 20,422 25,888 20,749 2,123 69,182 19,988 41 19,440 39

Agency Direction and 

 Administrative 

Support 142,642 147,673 5,592 5,431 15,591 156,033 182,647 40,005 28 34,974 24

Inspector General 5,822 6,220 0 0 0 7,057 7,057 1,235 21 837 13

Total SEC Funding $1,101,547 $1,143,855 $861,681 $150,947 $218,146 $176,709 $1,407,483 $305,936 28% $263,628 23%

Percent Increase over Prior Year 22% 35% 18% 25%

*FY 2010 includes $7,753 from the $10,000 supplemental appropriation the SEC received in July 2009 (P.L. 111-32).
- 12 -

Summary of Changes

($ in thousands)

FY 2011 FY 2012 Net

CR Request Change

Spending Authority $1,143,855 $1,407,483 +$263,628

Full-time Equivalents 3,848 4,460 +612 

Positions 4,047 4,827 +780 

Explanation of Changes: Positions FTE Amount

FY 2011 Base Changes

Annualization of staff brought on-board in FY 2011 - - - 31 +5,276 

Restore employee benefits - - - - - - +4,000

Restore summer intern program 7 28 +2,500 

Merit pay increases for eligible staff - - - - - - +18,930 

Increases in space rent and utilities - - - - - - +15,718 

Other non-compensation inflation of 1.4% - - - - - - +4,301 

Restore IT base - - - - - - +12,520

Restore litigation support - - - - - - +3,028

Other mandatories - - - - - - +3,276 

Subtotal, Base Changes 7 59 +$69,549

FY 2012 Program Increases

Information Technology Enhancements - - - - - - +10,000 

Staffing Increases: +$184,079

 Enforcement +156 +122 - - -

 Compliance Inspections & Examinations +195 +145 - - -

 Corporation Finance +50 +38 - - -

 Trading and Markets +80 +60 - - -

 Investment Management +31 +23 - - -

 Risk, Strategy and Financial Innovation +32 +24 - - -

 General Counsel +23 +17 - - -

 Other Program Offices +56 +41 - - -

 Agency Direction & Admin. Support +147 +82 - - -

 Inspector General +3 +1 - - -

Subtotal, Program Increases +773 +553 +$194,079

Total Change +780 +612 +$263,628
- 13 -

Offsetting Collections and Spending Authority

$0 

$200 

$400 

$600 

$800 

$1,000 

$1,200 

$1,400 

$1,600 

$1,800 

$2,000 

2003 

Actual

2004 

Actual

2005 

Actual

2006 

Actual

2007 

Actual

2008 

Actual

2009 

Actual

2010 

Actual

2011 

Target

2012 

Target

$ in millions

Fiscal Year

Offsetting Collections

Sections 13(e) & 14(g)

Section 31

Section 6(b)

FY 2010 FY 2011 FY 2012

Actual Estimate1 Estimate

Source of Offsetting Collections ($ in thousands)

Registration of securities: Securities Act of 1933 (Section 6(b))2 $218,784 $394,000 ---

Securities transactions under the Securities Exchange Act

of 1934 (Section 31)

1,223,826 1,321,000 1,407,483

Merger and Tender Fees under the Securities Exchange Act 

of 1934 (Sections 13(e) and 14(g))3

19,274 25,000 ---

Total Offsetting Collections $1,461,884 $1,740,000 $1,407,483

FY 2010 FY 2011 FY 2012

Actual CR Request

Spending Authority ($ in thousands)

Current Year Appropriated Offsetting Collections $1,094,916 $1,111,000 $1,407,483

Available Balances from Prior Year Direct Appropriation4 7,753 0 0

Available Balances from Prior Years 16,084 32,855 0

Total Authority $1,118,753 $1,143,855 $1,407,483

____________________

1 Estimates for Section 6(b) fees of the 1933 Act and Section 31 fees of the 1934 Act are based on target fee collections under P.L. 107-123 and 

are not based on expectations relative to economic and market conditions.

2 Under the Dodd-Frank Act, starting in FY 2012, Section 6(b) fees of the 1933 Act and Section 13(e) and 14(g) of the 1934 Act will no longer be 

counted as offsetting collections. Fifty million in Section 6(b) fees will be deposited into the SEC’s Reserve Fund. The remaining fee collections 

for each fiscal year will be deposited in the General Fund of the Treasury. 3

Fees collected under Sections 13(e) and 14(g) do not have collection targets specified in statute. Rather, the rates for these fees must equal the 

rates assessed under Section 6(b).

4

Funding for this appropriation came from a two-year emergency supplemental appropriation enacted in FY 2009, and not from offsetting 

collections.
- 14 -

Appropriations Language

For necessary expenses for the Securities and Exchange Commission, including services as 

authorized by 5 U.S.C. 3109, the rental of space (to include multiple year leases) in the District 

of Columbia and elsewhere, and not to exceed $3,500 for official reception and representation 

expenses, $1,407,483,130, to remain available until expended; of which not less than $6,790,000 

shall be for the Office of Inspector General; of which not to exceed $45,000 may be used toward 

funding a permanent secretariat for the International Organization of Securities Commissions; of 

which, $483,130 shall be for strengthening the capacity and capabilities of the acquisition 

workforce as defined by the Office of Federal Procurement Policy Act, as amended (41 U.S.C. 

401 et seq.), including the recruitment, hiring, training, and retention of such workforce and 

information technology in support of acquisition workforce effectiveness or for management 

solutions to improve acquisition management; and of which not to exceed $100,000 shall be 

available for expenses for consultations and meetings hosted by the Commission with foreign 

governmental and other regulatory officials, members of their delegations, appropriate 

representatives and staff to exchange views concerning developments relating to securities 

matters, development and implementation of cooperation agreements concerning securities 

matters and provision of technical assistance for the development of foreign securities markets, 

such expenses to include necessary logistic and administrative expenses and the expenses of 

Commission staff and foreign invitees in attendance at such consultations and meetings 

including: (1) such incidental expenses as meals taken in the course of such attendance; (2) any 

travel and transportation to or from such meetings; and (3) any other related lodging or 

subsistence: Provided, That fees and charges authorized by section 31 of the Securities Exchange 

Act of 1934 (15 U.S.C. 78ee) shall be credited to this account as offsetting collections: Provided 

further, That not to exceed $1,407,483,130 of such offsetting collections shall be available until 

expended for necessary expenses of this account: Provided further, That the total amount 

appropriated under this heading from the general fund for fiscal year 2012 shall be reduced as 

such offsetting fees are received so as to result in a final total fiscal year 2012 appropriation from 

the general fund estimated at not more than $0. 
- 15 -

FY 2012 Request by Strategic Goal

The SEC focuses its resources on (1) fostering and enforcing compliance with federal securities 

laws, (2) establishing an effective regulatory environment, (3) facilitating access to the 

information investors need to make informed investment decisions, and (4) enhancing the 

agency’s performance through effective alignment and management of human information, and 

financial capital. 

The budget request for FY 2012 totals approximately $1.4 billion, an increase of about $264 

million (23 percent) over the agency’s FY 2011 continuing resolution (CR) funding level. The 

FY 2012 budget funds 4,388 permanent full-time equivalents (FTE), an increase of 584 FTE (15

percent) over the FY 2011 CR level, and increases the number of permanent positions by 773 to 

a total of 4,753. Chart 1 depicts how the agency plans to allocate its resources in FY 2012 to 

achieve the goals identified in the agency’s strategic plan. 

The additional resources requested for FY 2012 will bolster the SEC’s efforts to achieve each of 

its four strategic goals, and allow the agency to begin overseeing the new markets and market 

participants brought under the SEC's jurisdiction by the Dodd-Frank Act. Resources that directly 

support fostering and enforcing the securities laws will increase approximately 22 percent from 

FY 2011 to FY 2012; resources utilized in establishing an effective regulatory environment will 

increase by approximately 35 percent compared to FY 2011; and activities that aim to foster 

informed investment decision-making will receive an estimated 18 percent increase. 

The agency is mindful that significantly increasing staffing in the program areas requires a 

commensurate increase in staff and funding for support offices. The resources attributed to 

agency direction and administrative support has not historically kept pace with changes in 

program areas. The additional administrative and support resources requested for FY 2012 will 

redress this differential, and will account for approximately 13 percent of the total budget for 

Goal 3

Facilitate access to the information investors 

need to make informed investment decisions 

$218,146 (15%)

 

Goal 4

Enhance the Commission’s performance 

through effective alignment and management 

of human, information, and financial capital

$176,709 (13%)

 

Goal 2

Establish an effective regulatory environment 

$150,947 (11%)

 

Chart 1

FY 2012 Request by Strategic Goal

($ in thousands)

Goal 1

Foster and enforce compliance with the federal securities laws 

$861,681 (61%)

 
- 16 -

FY 2012; this represents an increase of about 25 percent compared to FY 2011 CR levels. This 

increase is largely due to substantial investments in information technology (IT), staff training, 

and activities to further integrate financial management systems. Technology investments will 

support efforts such as implementing requirements contained in the Dodd-Frank Act; advancing

agency-wide data management and integration; and improving the agency’s disclosure systems, 

infrastructure, and management of projects. 

The SEC organizes its divisions and offices under 10 major programs that work together to 

achieve the four strategic goals. Among other things, these programs seek to detect and address 

violations and potential problems in the securities markets; provide investors with timely access 

to accurate, adequate, and useful disclosure materials; oversee market participants to promote 

confidence in the integrity and fairness of the markets; and align the agency’s human capital 

strategies, information technology initiatives, and other resources so as to most efficiently 

achieve the agency’s mission, goals, and outcomes. Chart 2 specifies how the agency plans to 

allocate its resources to the programs in FY 2012. 

The following chapters comprise the agency’s performance budget for FY 2012, which explains 

how the SEC plans to use the requested resources to achieve each of its four strategic goals. 

Each strategic goal chapter opens by reviewing the purpose of the goal, followed by information 

identifying the resources allocated to achieving the goal. A general discussion of the means and 

strategies the programs will use to achieve FY 2012 performance levels also is included, as well 

as a presentation of performance measures and indicators identified in the SEC’s new strategic 

plan covering FY 2010 - FY 2015. 

General Counsel

$52,957 (4%)

163 FTE (4%)

Agency Direction & Administrative Support

$182,647 (13%)

589 FTE (14%)

Enforcement

$455,726 (32%)

1,366 FTE (31%)

Compliance Inspections & Examinations

$303,858 (22%)

1,002 FTE (23%)

Investment Management

$62,379 (4%)

181 FTE (4%)

 

Other Program Offices

$69,182 (5%)

206 FTE (5%)

Chart 2

FY 2012 Request by SEC Program

($ in thousands)

Trading and Markets

$84,693 (6%)

272 FTE (6%)

Corporation Finance

$157,808 (11%)

503 FTE (11%)

Risk, Strategy & Financial Innov.

$31,176 (2%)

86 FTE (2%)

Inspector General

$7,057 (< 1%)

20 FTE (< 1%)
- 17 -

In FY 2011 and FY 2012, SEC programs will work to implement the requirements of the 

Government Efficiency, Effectiveness, and Performance Improvement Act of 2010. Reforms 

outlined in the Act will focus on providing agency management with improved information on 

measurable performance results in order to support effective resource management. 

To complement the FY 2012 performance budget, the agency also presents its FY 2012 budget 

by program (beginning on page 49). Each program chapter provides detailed information on 

program priorities, initiatives, and workload figures for the relevant divisions and offices.
- 18 -

Goal 1: Foster and Enforce Compliance with the Federal Securities Laws

In FY 2012, the agency is requesting a total of 1,097 positions (1,002 FTE) for the national 

examination program and 1,432 positions (1,366 FTE) for the Enforcement program. The 

additional resources will allow the SEC to continue implementation of various provisions under 

the Dodd-Frank Act, and begin addressing the disparity between the number of exam staff and 

the growing number and complexity of registered firms. Additionally, the Commission will be 

able to take prompt action to halt misconduct, sanction wrongdoers effectively, and return funds 

to harmed investors. Continued technology investments for improved data and information 

management also will be a top priority. In all, the agency plans to devote approximately $862

million and 2,674 permanent FTE to enforcing compliance with the federal securities laws.

Chart 3 

Outcome 1.1: The SEC fosters compliance with the federal securities laws.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: Working to 

detect and prevent violations of the securities laws is key to protecting investors and enhancing 

market integrity. Efforts designed to promote investor awareness are the first line of defense 

against fraud, and the SEC expects to issue approximately 24 Investor Alerts and Bulletins in 

FY 2012, providing investors with information they need to make wise investment decisions and 

limiting opportunities for investor abuse (Measure 1).

The SEC seeks to encourage within organizations of all sizes a strong culture of compliance that 

fosters ethical behavior and decision-making. The SEC plans to double its outreach efforts for 

promoting compliance by conducting approximately 12 CCOutreach events in FY 2012 

(Measure 2). Furthermore in FY 2012, the staff expects to continue devoting a significant 

amount of time and resources to make compliance outreach as relevant and beneficial as possible 

for registered entities. The staff will continue to make every effort to ensure that this program 

reaches as many chief compliance officers as possible and that it continues to be extremely 

useful in helping registered firms with their compliance efforts (Measure 4).

In an effort to deter future violations of the federal securities laws, examination staff will work 

with registrants to ensure that corrective action is taken in response to deficiencies identified 

during an examination. In FY 2012, the SEC expects 91 percent of registrants to take action or 

state that they will take action to correct identified problems (Measure 3). To increase 

Compliance Inspections & Examinations (38%)

Enforcement (51%)

Trading and Markets (2%)

Investment Management (2%)

General Counsel (4%)

Other Program Offices (2%)

Trading and Markets (2%)

General Counsel (4%)

Other Program Offices (2%)

Compliance Inspections & Examinations (36%)

Enforcement (53%)

FY 2012 Request (Permanent FTE)

2,674 Total FTE

FY 2012 Request ($ in thousands)

$861,681 Total Cost

Investment Management (2%)

Risk, Strat. & Fin. Innov. (1%) Risk, Strat. & Fin. Innov. (1%)
- 19 -

compliance efforts or remedial actions taken by registrants, the SEC will provide more proactive 

communications with registrants and their personnel, including chief compliance officers. 

Additionally, the SEC will improve the quality, quantity, and means of communication of

important compliance information.

Goal 1: Measure 1

Number of new investor education materials designed specifically to help investors protect 

themselves from fraud

Description: Through its Office of Investor Education and Advocacy (OIEA), and often in 

conjunction with other organizations, the agency issues Investor Alerts and other forms of 

educational material that inform investors about new or emerging types of fraud.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Percentage of positive 

response

Prior-year data not 

available N/A 16 24 24

Goal 1: Measure 2

Number of industry outreach and education programs targeted to areas identified as raising 

particular compliance risks

Description: Targeted communication with industry participants on topics shaping the 

examination program is intended to enhance compliance practices and prevent violations before 

they occur. This measure identifies the number of major outreach efforts conducted, including the 

agency’s national and regional CCOutreach events, published ComplianceAlerts, and other 

educational initiatives.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Number of major outreach 

efforts

Prior-year data not 

available N/A 6 10 12

Goal 1: Measure 3

Percentage of firms receiving deficiency letters that take corrective action in response to all 

exam findings

Description: At the conclusion of examinations, the staff communicates identified deficiencies to 

registrants in the form of a deficiency letter. Registrants are then given a chance to respond to staff 

findings and often take action to remedy any problems and potential risks. Most often, registrants 

respond that they have corrected the deficiencies and implemented measures to prevent recurrence.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Percentage 94% 93% 94% 95% 90% 90% 91%
- 20 -

Goal 1: Measure 4

Percentage of attendees at CCOutreach that rated the program as "Useful" or "Extremely 

Useful" in their compliance efforts

Description: The CCOutreach program is designed to educate, inform, and alert CCOs of pertinent 

information, including about effective compliance controls, that may assist them in administering 

compliance programs within registered firms. Improving compliance programs will reduce violative 

activity, resulting in increased protection for investors. At the conclusion of all CCOutreach events, 

CCOs are given the opportunity to rate the usefulness of the information provided in assisting them 

in their compliance efforts.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Percentage 97% 92% 84% 92% 77% 80% 82%

Goal 1: Indicator 1

Percentage of actions identified as "high impact" which have resulted in significant corrective 

industry reaction

Description: The Commission is striving to enhance communication resulting from high impact 

action, as discussed above. This indicator will examine how market participants, whose behavior is 

intended to most be influenced by the enhanced communication, react to high impact actions. For 

example, are the issues raised by the Commission’s filed action discussed in prominent private 

sector educational forums or literature?

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Percentage Prior-year data not available 100% 

Goal 1: Indicator 2

Annual increases or decreases in the number of CCOs attending CCOutreach programs

Description: While the raw number of CCOs in the industry may vary depending on factors outside 

of the SEC’s control, the Commission seeks to provide educational programs that are highly valued 

by attendees and their employers. Analyzing changes in participation levels will foster continued 

improvement in both program content and outreach efforts.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Number of CCOs Prior-year data not available N/A 

Outcome 1.2: The SEC promptly detects violations of the federal securities laws.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: With the 

additional positions requested in FY 2012, the national examination program will be able to 

fulfill the agency’s mission more effectively, continue implementation of various provisions 

under the Dodd-Frank Act (e.g., annual examinations of NRSROs), and begin addressing the 

disparity between the number of exam staff and the growing number and complexity of 

registered firms. 

In FY 2012, the SEC will continue to implement extensive reforms to the national examination 

program including enhanced training of staff, improved examination planning, and strengthened 
- 21 -

risk-assessment techniques. The agency’s risk-based program is designed to focus resources on 

those firms and practices that have the greatest potential risk of securities laws violations that can 

harm investors. In FY 2010, examiners identified deficiencies in 72 percent of exams, and 

42 percent of deficiencies identified were categorized as significant (Indicator 3). 

The SEC will continue to improve surveillance capabilities by enhancing the methods and 

technologies used to obtain greater access to data and to help staff more effectively prepare for 

and conduct examinations. While the improved techniques and growing numbers of regulated 

entities will result in lower percentages of registrants examined as compared to prior years, these 

efforts are expected to help the SEC identify those firms that have the greatest potential risk of 

violating federal securities laws (Measure 7).

Through disclosure reviews and examinations of regulated entities and other market participants, 

the SEC seeks to both detect violations and to foster strong compliance and risk management 

practices within these firms and organizations. Many examinations are expected to take longer 

in FY 2011 and FY 2012 than in previous years due to more rigorous examination protocols 

(Measure 8). Going forward, staff will implement improved examination processes identified 

during the top-to-bottom review of the national examination program, and staff will strive to 

complete all exams within the new 180 day timeframe as outlined in the Dodd-Frank Act.

Goal 1: Measure 5

Percentage of cause and special exams (sweeps) conducted as a result of risk assessment 

process that includes multi-divisional input

Description: As SEC staff expands its use of risk-based methods and has more data available for 

risk analysis, staff anticipates that the percentage volume of exams driven by a more robust risk 

assessment process will increase.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Percentage

Prior-year data not 

available N/A N/A N/A N/A

Goal 1: Measure 6

Percentage of advisers deemed "high risk" examined during the year

Description: To conduct oversight of investment advisers, the staff conducts a risk-based program 

of examinations. Certain advisers are identified as high risk at the beginning of every fiscal year, and 

then inspections are planned on a cyclical basis. The staff’s goal is to inspect high-risk advisers at 

least once every three years. Meeting this target will depend upon the SEC having sufficient 

resources to keep pace with growth in the industry and the need for examiners to check compliance 

with evolving regulatory requirements.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Percentage 33% 33% 22% 33% N/A N/A N/A
- 22 -

Goal 1: Measure 7 

Percentage of investment advisers, investment companies, and broker-dealers examined during 

the year

Description: This measure indicates the number of registrants examined by the SEC or a SRO as a 

percentage of the total number of registrants. This measure includes all types of examinations: 

routine examinations, cause inspections to follow up on tips and complaints, limited-scope special 

inspections to probe emerging risk areas, oversight examinations of broker-dealers to test compliance 

and the quality of examinations by the Financial Industry Regulatory Authority (FINRA).

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Investment advisers 13% 14% 10% 9% 9% 11% 13%

Investment companies 20% 23% 29% 15% 10% 11% 12%

Broker-Dealers (exams by 

SEC and SROs) 54% 57% 54% 55% 44% 45% 46%

Goal 1: Measure 8

Percentage of non-sweep and non-cause exams that are concluded within 120 days

Description: The staff conducts examinations each year of investment advisers, investment 

company complexes, transfer agents, and broker-dealers. The staff strives to complete its 

examinations in the most efficient and effective manner. When possible, the staff attempts to 

conclude its examinations within 120 days of the end of any field work completed. However, some 

examinations require significantly more time so that potential violations are fully reviewed. To 

ensure that time pressure does not impair quality, the target for this benchmark should not be set too 

high. This performance measure was modified during the FY 2010 strategic planning process to 

report the percentage of non-sweep and non-cause exams completed within 120 days. Data reported 

prior to FY 2010, reflect only the percentage of non-sweep exams completed within 120 days. 

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Percentage 79% 79% 65% 75% 48% 50% 55%

Goal 1: Indicator 3

Percentage of exams that identify deficiencies, and the percentage that result in a "significant 

finding"

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

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

be in a record. However, other deficiencies may cause harm to customers or clients of a firm, have a 

high potential to cause harm, or reflect recidivist misconduct. The latter deficiencies are among those 

categorized as “significant.” This measure identifies the percentage of exams by registrant category 

that identified deficiencies, and that resulted in significant deficiency findings.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Percentage that identify deficiencies Prior-year data not available 72%

Percentage that result in a “significant 

finding” Prior-year data not available 42%
- 23 -

Goal 1: Indicator 4

Number of investigations or cause exams from tips

Description: Analysis of a tip can support the request for a cause exam or an enforcement 

investigation. This indicator would identify the volume of SEC investigations and cause exams that 

result from tips collected through outreach efforts.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Office of Compliance Inspections and Examinations

Number of investigations Prior-year data not available 303

Division of Enforcement

Number of cause exams Prior-year data not available N/A

Outcome 1.3: The SEC prosecutes violation of federal securities laws and holds violators 

accountable.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: In FY 2012, 

the agency requests an additional 156 positions (122 FTE) over FY 2011 CR levels for the 

Enforcement program, so that staff will be able to swiftly address areas most at risk for fraud, 

and investigate and prosecute any potential violations of federal securities laws. The agency will 

continue to balance the need for complete, effective, and fair investigations with the need for 

timely filing of enforcement actions against individuals and companies who violate securities 

laws. In FY 2012, the agency anticipates that the percentage of first enforcement cases filed 

within two years of opening an investigation or inquiry will be higher than in prior years 

(Measure 10). 

The SEC will continue to improve the quality and efficiency of its investigations with seasoned 

investigators on the front lines, specialized units focused on specific programmatic priorities, 

enhanced case management systems, and increased coordination efforts with other offices and 

divisions in the agency and other regulators. In FY 2012, the SEC anticipates bringing strong 

cases and sustaining its win rate of 92 percent (Measure 9). A continued high success ratio 

depends on numerous factors, including the complexity of cases and the extent to which parties 

contest actions. The agency will monitor the percentage of its cases deemed “high impact” and 

also the criminal proceedings related to SEC investigations (Indicator 6 and Indicator 8). 

Under the Sarbanes-Oxley Act of 2002, the SEC can use Fair Funds to redirect penalties 

collected from securities law violators to the victims of their wrongdoing (Indicator 9). The SEC 

is committed to the timely collection and distribution of penalties and disgorgement monies and 

is requesting additional staffing for the Office of Collections and Distributions (OCD). OCD is 

responsible for collecting ordered penalties and disgorgement amounts, and returning funds to 

harmed investors whenever possible. 

In FY 2012, the SEC will seek to obtain payment or institute collection activities within six 

months of the due date of a debt for at least 90 percent of debts (Measure 11). The agency also 

will gauge its timeliness in distributing funds to injured investors by monitoring the volume of 

first payments within 12 months of the approval date of a plan (Measure 13), and the percentage 

of final distributions made within 24 months of appointing a fund administrator (Measure 12). 
- 24 -

Goal 1: Measure 9

Percentage of enforcement actions successfully resolved

Description: An action is considered “successfully resolved” if it results in a favorable outcome for 

the SEC, including through litigation, a settlement, or the issuance of a default judgment. In general, the 

SEC strives to successfully resolve as many actions as possible but, at the same time, aims to file large, 

difficult, or precedent-setting actions when appropriate, even if success is not assured. This measure 

does not include any actions in which the SEC awaits a final outcome. The measure is calculated on a 

per-defendant basis. Large actions may involve several defendants.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Percentage 92% 92% 92% 90% 92% 92% 92%

Goal 1: Measure 10

Percentage of first enforcement actions filed within two years

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

of opening of a MUI (“matter under inquiry”). In conducting investigations, the enforcement program 

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.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010

Actual

FY

2011

FY 

2012

Percentage 54% 62% 70% 65% 67% 70% 72% 

Goal 1: Measure 11 

Percentage of debts where either a payment has been made or a collection activity has been 

initiated within six months of the due date of the debt

Description: The SEC can seek a wide range of remedies for failure to comply with the securities 

laws. These remedies include civil monetary penalties and disgorgement. When the remedies are 

imposed by the Commission or the federal district court, payments must be made by a certain date. This 

measure identifies the percentage of debts where debtors have made payments or the SEC has initiated 

a collection activity within 180 days of the due date. Such collection activities include, among other 

things, demand letters, negotiation of payment plans, enforcing the payment of the debt through the 

courts, or other judicial remedies.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010

Actual

FY

2011

FY 

2012

Percentage N/A 88% 90% 92% 86% 90% 90% 
- 25 -

Goal 1: Measure 12

Percentage of Fair Fund and disgorgement fund plans that distributed the final tranche of funds 

to injured investors within 24 months of the order appointing the fund administrator

Description: In addition to other types of relief, the Commission may seek orders requiring parties to 

disgorge any money obtained through wrongdoing. The Commission also is empowered to seek civil 

penalties for violations of the securities laws. Where appropriate, the Commission has sought to return 

disgorged funds to harmed investors and, as a result of the Fair Funds provision of the Sarbanes-Oxley 

Act, as awarded to combine amounts paid as penalties with disgorged funds, or to create a Fair Fund 

from penalties only, to reduce losses to injured parties. After sufficient disgorgement and/or penalties 

have been collected to form a distribution fund, the Commission appoints, or, in civil actions, seeks the 

appointment of, a fund administrator to develop and subsequently implement an approved plan to 

distribute funds to injured investors. Using the claims-made process, the fund administrator identifies 

injured investors and determines amounts to be disbursed to eligible claimants. The distribution of 

funds to eligible claimants may be made in several tranches to return funds to investors more quickly, 

while efforts continue to locate any remaining investors through the claims-made process. This measure 

identifies the percentage of “claims-made” distribution plans that distributed the final tranche during 

the fiscal year and within 24 months of the order appointing the fund administrator. This reflects 

Commission-wide efforts to develop, approve, and implement plans to return funds to investors 

quickly, regardless of the monetary amount in the fund. Any funds not returned to investors are sent to 

the U.S. Treasury; neither disgorgement nor penalties are used for the Commission’s own expenses.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY

2011

FY 

2012

Percentage

Prior-year data not 

available N/A N/A TBD TBD

Goal 1: Measure 13

Percentage of Fair Fund and disgorgement fund plans approved by final order within the prior 

fiscal year which had a first tranche of funds distributed under those plans within 12 months of 

such approval date

Description: In its enforcement actions, the Commission may seek to return funds to harmed investors 

through disgorgement of ill-gotten gains or through the Fair Funds provision of the Sarbanes-Oxley 

Act, as amended. This provision permits the Commission to combine amounts paid as penalties with 

disgorged funds, or to create a Fair Fund from penalties only, to reduce losses to injured parties. This 

measure identifies the percentage of distribution plans for which a first tranche was distributed to 

injured investors within 12 months of the plans’ approval date. This reflects the Commission’s efforts 

to return funds to investors quickly, regardless of the monetary amount in the fund. Any funds not 

returned to investors are sent to the U.S. Treasury; neither disgorgement nor penalties are used for the 

Commission’s own expenses.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY

2011

FY 

2012

Percentage

Prior-year data not 

available 60% N/A TBD TBD 
- 26 -

Goal 1: Indicator 5

SEC investigations referred to SROs or other state, federal, and foreign authorities for 

enforcement

Description: The SEC works closely with other regulators and authorities so that violators of federal 

securities laws are held accountable. In certain circumstances, a matter may be more appropriately 

handled by another entity or in another venue, and the agency will refer the investigation for further 

action. This measure identifies the number (or percentage of the agency’s total number) of 

investigations that are referred to others for action. This number includes investigations that SEC 

continues to pursue, as well as referrals more appropriately handled by other regulators or authorities.

Fiscal Year FY 2007 FY 2008 FY 2009 

FY 2010

Actual

Number of investigations Prior-year data not available 492 

Goal 1: Indicator 6

Percent of all enforcement investigations deemed "high impact"

Description: High impact or national priority investigations include those investigations which are 

significant for one or more of the following reasons: (1) The matter presents an opportunity to send a 

particularly strong and effective message of deterrence, including with respect to markets, products 

and transactions that are newly developing, or that are long established but by their nature present 

limited opportunities to detect wrongdoing and thus to deter misconduct. (2) The matter involves 

particularly egregious or extensive misconduct. (3) The matter involves potentially widespread and 

extensive harm to investors. (4) The matter involves misconduct by persons occupying positions of 

substantial authority or responsibility, or who owe fiduciary or other enhanced duties and obligations 

to a broad group of investors or others. (5) The matter involves potential wrongdoing as prohibited 

under newly-enacted legislation or regulatory rules. (6) The potential misconduct occurred in 

connection with products, markets, transactions or practices that pose particularly significant risks for 

investors or a systemically important sector of the market. (7) The matter involves a substantial 

number of potential victims and/or particularly vulnerable victims. (8) The matter involves products, 

markets, transactions or practices that the Enforcement Division has identified as priority areas (i.e., 

conduct relating to the financial crisis; fraud in connection with mortgage-related securities; financial

fraud involving public companies whose stock is widely held; misconduct by investment advisers; and 

matters involving priorities established by particular regional offices or the specialized units). (9) The 

matter provides an opportunity to pursue priority interests shared by other law enforcement agencies 

on a coordinated basis.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Percentage Prior-year data not available 3.26% 
- 27 -

Goal 1: Indicator 7

Percent of investigations that come from internally-generated referrals or prospects

Description: Through enhanced risk assessment practices, the agency aims to improve its ability to 

identify internally-generated tips or prospects for investigations. Internal prospects could include 

issues identified during the course of SEC examinations, analysis of data, disclosure reviews, or other 

activities.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Percentage Prior-year data not available 21.9%

Goal 1: Indicator 8

Criminal investigations relating to SEC investigations

Description: In some instances, investigations may reveal that both civil and criminal violations have 

occurred, and the agency will refer matters to criminal authorities so that the criminal authorities may 

determine whether to conduct a criminal investigation.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Number of investigations 

referred Prior-year data not available 139 

Goal 1: Indicator 9

Disgorgement and penalties ordered and the amounts collected by the SEC

Description: In addition to other types of relief, the SEC may seek orders requiring parties to 

disgorge any money obtained through wrongdoing. The SEC is also empowered to seek civil penalties 

for violations of the securities laws. Where appropriate, the SEC has sought to return disgorged funds 

to harmed investors. Funds not returned to investors are sent to the Treasury. This indicator lists 

disgorgement and penalties ordered as a result of SEC cases and the amounts collected by the SEC. 

This indicator could increase or decrease based on various factors.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Ordered amounts (in 

millions) $1,601 $1,030 $2,442 $2,846 

Collected amounts (in 

millions) $978 $512 $1,683 $1,724
- 28 -

Goal 2: Establish an Effective Regulatory Environment

The Commission will continue a rulemaking agenda that will protect investors and seek to ensure 

that markets operate fairly, with appropriate consideration for any disproportionate impact on 

small businesses. In FY 2012 the SEC will complete and implement the new regulatory structure 

set forth under the Dodd-Frank Act, and will begin its review of other non-Dodd-Frank rules that 

may need updating in light of changing conditions. In FY 2012, the agency plans to devote 

approximately $151 million and 459 FTE to achieve this goal. 

Chart 4

Outcome 2.1: The SEC establishes and maintains a regulatory environment that promotes 

high quality disclosure, financial reporting, and governance, and that prevents abusive 

practices by registrants, financial intermediaries, and other market participants.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: The 

Commission uses its authority to shape the regulatory framework so that investors are protected 

through the availability of high-quality disclosure. In FY 2012, under the Dodd-Frank Act, the 

agency plans to develop regulations that promote and strengthen corporate disclosures, 

harmonize regulatory structures for investment advisers and broker-dealers, and promote 

confidence in the integrity and fairness of the markets. The SEC will continue to evaluate and, 

where necessary, amend its rules and regulations to improve the quality and usefulness of 

registrants’ disclosures to investors (Measure 1). 

Additionally in FY 2012, the Office of International Affairs (OIA) will continue working with 

the International Organization of Securities Commissions (IOSCO) and foreign regulatory 

counterparts to promote international cooperation and assistance on international enforcement 

matters. OIA will work cooperatively within IOSCO and the Financial Stability Board to 

enhance cross-border supervisory cooperation. Furthermore, OIA will advise the agency on 

other regulatory policy initiatives, including those identified by the Group of 20 (G-20) leaders 

such as hedge fund regulation, cross-border oversight of credit rating agencies, and progress 

towards a single set of high quality global accounting standards (Measure 2 and Measure 3). 

FY 2012 Request (Permanent FTE)

459 Total FTE

FY 2012 Request ($ in thousands)

$150,947 Total Cost

Trading and Markets

(32%)

Investment 

Management (19%)

Trading and 

Markets (30%) Investment Management

 (19%)

Agency Direction & Administrative Support (3%)

Other Program 

Offices (17%)

Agency Direction & Administrative Support (4%)

Corporation Finance

 (14%)

Other Program 

Offices (17%)

General 

Counsel (6%)

Corporation Finance 

(14%)

General 

Counsel (6%)

Risk, Strat. & 

Fin. Innov. (9%)

Risk, Strat. & Fin. 

Innov. (10%)
- 29 -

Goal 2: Measure 1

Survey on quality of disclosure

Description: Under this metric, the SEC plans to conduct surveys of individual investors to elicit 

feedback on the quality of disclosures and the Commission’s disclosure requirements. The SEC 

would track whether the percentage of respondents answering positively improves over time.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Percentage of positive 

response

Prior-year data not 

available N/A N/A TBD TBD

Goal 2: Measure 2

Number of consultations; joint events, reports, or initiatives; and joint examinations and 

other mutual supervisory efforts with SROs and other federal, state, and non-U.S. regulators

Description: This metric gauges how much the SEC is coordinating with other financial regulatory 

agencies within a given fiscal year. Also, as securities markets around the world become 

increasingly integrated and globalized, it is essential that the SEC work frequently and effectively 

with its partner regulators both in the U .S . and abroad.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 

2010 

Actual

FY

2011

FY

2012

Percentage of positive 

response Prior-year data not available TBD TBD

Goal 2: Measure 3

Number of non-U.S. regulators trained

Description: This metric shows the reach of the SEC’s technical assistance programs for 

regulators around the world. The SEC conducts these training sessions to assist countries in 

developing and maintaining robust protections for investors and promote cross-border enforcement 

and supervisory assistance. 

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Number of non-U.S. 

regulators Prior-year data not available 1,905 1,997 2020 2040

Goal 2: Indicator 1 

Average cost of capital in U.S. relative to the rest of the world

Description: Countries’ cost of capital can vary according to their protections for investors, the 

strength of their disclosure regimes, and the presence of fair, orderly, and efficient markets, among 

other factors. Therefore, although this metric is affected by other economic factors, it can provide 

some indication of the quality of securities regulation in a given country.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Average cost of capital Prior-year data not available 10.99% 
- 30 -

Outcome 2.2: The U.S. capital markets operate in a fair, efficient, transparent, and 

competitive manner, fostering capital formation and useful innovation. 

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: While the 

number of participants supervised by the Division of Trading and Markets (TM) has been 

relatively static over the past several years, the division anticipates a significant increase in FY 

2012 in the number of registered securities exchanges, clearing agencies, and new registrants 

under the Dodd-Frank Act. The additional resources requested for TM will enable the division 

to assume the significant new responsibilities while continuing to enhance existing supervision 

of securities firms and markets.

The SEC plays a key role in protecting the stability and ensuring the resilience of the U.S. 

financial system, thereby promoting investor confidence. In FY 2012, the SEC will continue to 

perform inspections of the automated trading and clearing processes of markets and clearing 

organizations, monitor for systems outages and changes, and monitor the compliance of markets 

and clearing agencies with applicable continuity planning standards. The agency will continue to 

assess the resiliency of market systems, expecting market outages will be corrected within 

targeted timeframes (Measure 6). Furthermore, the agency expects 99 percent of transaction 

dollars to be settled on time, continuing a trend of timely settlement (Measure 4).

Goal 2: Measure 4 

Percentage of transaction dollars settled on time each year

Description: This metric measures the efficiency of the U.S. clearance and settlement system for 

equity securities.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY

2011

FY

2012

Percentage N/A 99% 99% 99% 99% 99% 99%

Goal 2: Measure 5

Average institutional transaction costs for exchange listed stocks on a monthly basis

Description: This performance metric captures the actual cost of trading in large (institutional size) 

transactions.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010 

Actual

FY

2011

FY

2012

Average Transaction 

costs

Prior-year data not 

available N/A N/A TBD TBD
- 31 -

Goal 2: Measure 6 

Percentage of market outages at SROs and electronic communications networks (ECNs) that are 

corrected within targeted timeframes

Description: Market outages reflect problems in the systems underlying the securities markets that 

could have an adverse affect on the markets’ ability to function as required. The SEC assesses the 

reliability and resiliency of these systems to minimize the number and duration of outages. This metric 

gauges how quickly outages are resolved, so that market activity can resume.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY

2011

FY

2012

Within 2 hours 81% 84% 87% 60% 74% 60% 60%

Within 4 hours 91% 96% 98% 75% 85% 75% 75%

Within 24 hours 100% 100% 98% 96% 100% 96% 96%

Goal 2: Indicator 2 

Average quoted spread for exchange listed stocks on a monthly basis

Description: This indicator gauges the hypothetical cost of trading in small amounts at the quoted 

markets, based solely on published quotations.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Cents Prior-year data not available 2.52 

Goal 2: Indicator 3

Average effective spread for exchange listed stocks on a monthly basis

Description: This indicator captures the cost of trading in small amounts based on actual trade prices 

and the quotes at the times of those trades.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Cents Prior-year data not available 2.65 

Goal 2: Indicator 4

Speed of Execution

Description: This indicator gauges how quickly transactions are executed in the U.S. securities 

markets.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Seconds Prior-year data not available 1.77 
- 32 -

Goal 2: Indicator 5

Average quoted size of exchange listed stocks on a monthly basis

Description: This indicator measures the amount of liquidity visible to the market at the displayed 

quotes.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Average quoted size Prior-year data not available N/A 

Goal 2: Indicator 6

Average daily volatility of exchange listed stocks on a monthly basis

Description: This statistic gauges short term price changes, which are an indicator of the risk of 

holding stock.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Percentage Prior-year data not available 1.18% 

Outcome 2.3: The SEC adopts and administers rules and regulations that enable market 

participants to understand clearly their obligation under the securities laws.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: The process 

of developing and administering rules and regulations is one of the primary functions of the SEC 

and involves staff from nearly every division and office. The SEC must continually reevaluate 

its regulatory framework to ensure that market participants understand clearly the rules and 

regulations. Additionally, the SEC is undertaking significant rulemaking to implement a number 

of key areas of the Dodd-Frank Act. In coming years, the SEC intends to survey market 

participants, such as broker-dealers and investment advisers, to determine whether they believe 

the Commission’s regulatory requirements are clear (Measure 8). 

The SEC devotes a large share of resources responding to no-action letters and interpretive and 

other requests from regulated entities, public companies, and other outside parties. The agency 

is committed to speeding the response to such requests where appropriate. Although each 

division has separate processes and benchmarks for their responses (Measure 7), the agency is 

committed to responding to such requests in a timely way. 

In accordance with reforms outlined in the Dodd-Frank Act, SRO rule proposals received on or 

after July 22, 2010 must be reviewed within 45 days after publication. Going forward, the SEC 

will not track filings using the 35 day measure. TM expects to deploy additional staff to review 

higher numbers of SRO rule filings, with a target of completing 80 percent of filings within 45

days (Measure 9).

Additionally, the agency expects to review registrations for new exchanges, security-based swap 

execution, clearing agencies, and security-based swap data repositories, while monitoring the 

impact of market developments. As a result of changes to Commission procedures brought 

about by the Dodd-Frank Act, many of the rule changes filed with the Commission must be 

approved or disapproved on a significantly expedited basis. This expedited process places 

further demands on a process that already involves numerous reviews of drafts of complex rule 

changes. 
- 33 -

Goal 2: Measure 7 

Length of time to respond to written requests for no-action letters (NAL), exemptive 

applications, and written interpretive requests

Description: The SEC staff responds to requests for guidance from individuals and companies 

about specific provisions of the federal securities laws. These queries can ask for proper 

interpretations of the securities laws or regulations, or for assurances that no enforcement action 

will be taken in certain circumstances. The staff also reviews applications for exemptions from 

the securities laws. Written responses to such requests for guidance, when provided, generally are 

publicly available, as are applications and related notices and orders, when issued. This measure 

gauges whether the Divisions of Trading and Markets, Investment Management, and Corporation 

Finance are issuing initial comments on these requests on a timely basis.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 

2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Trading and Markets: No-action letters, exemptive applications, and written interpretive requests 

(combined figure)

Percentage 91% 63% 70% 85% 91% 85% 85% 

Investment Management

No-action letters and 

interpretive requests 91% 98% 100% 75% 100% 75% 75% 

Exemptive applications N/A 81% 95% 80% 100% 80% 80% 

Corporation Finance

No-action letters and 

interpretive requests (1) 66% 66% 85% 90% 97% 90% 90%

Shareholder proposals (2) 100% 100% 100% 100% 100% 100% 100%

Goal 2: Measure 8

Survey on whether SEC rules and regulations are clearly understandable

Description: The SEC aims to promote a regulatory environment in which market participants 

clearly understand their obligations. Through this metric, the SEC intends to survey market 

participants to determine whether they believe the Commission’s regulatory requirements are 

clear.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Percentage 

Prior-year data not 

available N/A N/A NA NA
- 34 -

Goal 2: Measure 9

Time to complete SEC review of SRO rules that are subject to SEC approval

Description: The SEC reviews SRO rule proposals for consistency with the Exchange Act 

standards of investor protection, fair and orderly operation of the markets and market structure, as 

well as other statutory requirements. This metric gauges how long it takes the SEC to approve a 

filing after publication of notice of the proposal for comment. In accordance with reforms outlined 

in the Dodd-Frank Act, SRO rule proposals received on or after July 22, 2010 must be reviewed 

within 45 days after publication. Going forward, the SEC will not track filings using the 35 day 

measure.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Within 35 days

Prior-year data not 

available 40% 73% NA NA

Within 45 days

Prior-year data not 

available 80% 99% 99% 80%

Goal 2: Indicator 7

Percentage of SRO rule filings that are submitted for immediate effectiveness

Description: This metric gauges the proportion of SRO rule proposals that can be submitted for 

immediate effectiveness, without Commission approval.

Fiscal Year FY 2007 FY 2008 FY 2009 FY 2010

Percentage Prior-year data not available 69% 
- 35 -

Goal 3: Facilitate Access to the Information Investors Need to Make Informed 

Investment Decisions

A strong economy and a vibrant securities market rely on investor confidence and the 

widespread availability of relevant information about those securities. The SEC 

promotes informed investment decisions through two main approaches. The first is to 

require that investors have accurate, adequate, and timely public access to disclosure 

materials that are easily understood and analyzed. Secondly, the SEC implements a 

variety of investor education initiatives, aimed at giving investors a better understanding 

of the operations of the nation’s securities markets. In FY 2012, the agency plans to 

devote approximately $218 million and 680 permanent FTE to achieve this goal.

Chart 5 

Outcome 3.1: Investors have access to high-quality disclosure materials that are 

useful to investment decision making.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: An 

educated investing public ultimately provides the best defense against fraud and costly 

mistakes. The federal securities laws place great emphasis on assuring that corporations, 

investment companies, and other entities provide investors with timely, clear, complete 

and accurate financial and non-financial information, allowing investors to make 

informed investment decisions. These disclosures form a common pool of knowledge that 

all investors can use to judge for themselves if a security is a good investment. 

The Divisions of Corporations Finance (CF) and Investment Management (IM) expect to 

continue meeting the requirements of the Sarbanes-Oxley Act by reviewing the 

disclosures of about 33 percent of all reporting companies and investment company 

portfolios each year (Measure 1). This volume of disclosure review is expected to deter 

fraud and assure that investors have access to relevant information about emerging issues. 

In addition to reviewing the filings of reporting companies, CF will continue to issue 

initial comments on 1933 and 1934 Act registration statements and other transactional 

filings within its target goal of less than 30 days of filing (Measure 2). Additionally, IM 

Agency Direction & 

Administrative Support 

(7%)

Investment

Management (8%) Investment 

Management (8%)

Other Program 

Offices (8%)

General Counsel (1%)

Risk Srat. & Fin. 

Innov. (1%)

Corporation 

Finance (63%) Trading and 

Markets (11%)

Corporation 

Finance (61%)

Other Program 

Offices (10%)

Agency Direction 

& Administrative Support

(7%)

General 

Counsel (1%)

Trading and 

Markets (12%)

Risk Strat. & Fin. 

Innov. (2%)

FY 2012 Request (Permanent FTE)

680 Total FTE

FY 2012 Request ($ in thousands)

$218,146 Total Cost
- 36 -

aims to provide comments on investment company filings within timeliness goals for at 

least 85 percent of initial registration statements, 90 percent of post-effective 

amendments, and 99 percent of preliminary proxy statements in FY 2011 and FY 2012 

(Measure 3). 

During the FY 2010 strategic planning process, the SEC developed performance 

measures to monitor the availability of and access to securities industry information so 

that investors are armed with timely and meaningful information (Measure 4, Measure 5, 

and Measure 6). The agency will use these measures to explore whether its disclosure 

requirements, review criteria, approach to comments, and professional and technology 

resources are utilized to provide maximum benefit to investors. Results for Measure 7 

will be used to determine the level of satisfaction with disclosure requirements, and to 

shape the disclosure program in the future.

Goal 3: Measure 1 

Percentage of public companies and investment companies with disclosures reviewed each 

year

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

companies and investment company portfolios reporting under the Exchange Act at least once 

every three years. These reviews help improve the information available to investors and may 

deter violations of the securities laws.

Fiscal Year

FY

2007

FY

2008

FY 

2009 

FY 2010 

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Corporations 36% 39% 40% 34% 44% 33% 33% 

Investment Company 

Portfolios 38% 36% 35% 33% 35% 33% 33% 

Goal 3: Measure 2 

Time to issue initial comments on Securities Act filings

Description: The target of 30 days or less has become a de facto industry standard for the 

maximum time to receive initial comments.

Fiscal Year

FY

2007

FY

2008

FY 

2009 

FY 2010 

Plan

FY 2010 

Actual FY 2011 FY 2012

Days

25.5 

days

25.2 

days

25.3 

days

<30 

days

24.1 

days <30 days <30 days
- 37 -

Goal 3: Measure 3 

Percentage of investment company disclosure reviews for which initial comments are 

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.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Initial Registration 

Statements 87% 95% 95% 85% 93% 85% 85% 

Post-Effective Amendments 95% 97% 97% 90% 94%

 

90% 90% 

Preliminary Proxy 

Statements 99% 99% 99% 99% 99% 99% 

99

%

Goal 3: Measure 4

Point of Sale "click-through rate"

Description: The point of sale initiative relies on a layered approach that combines point of sale 

disclosure and Internet-based disclosure. This measure would determine how often investors click 

on broker-dealers’ websites to obtain information about broker-dealer compensation and related 

conflicts of interest.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

“click-through rate”

Prior-year data not 

available N/A N/A NA NA

Goal 3: Measure 5

Access to broker-dealer and investment adviser background checks

Description: Greater availability of professional background information of broker-dealers and 

their employees through the BrokerCheck system will provide investors with the ability to make 

better-informed decisions. Investors also have the ability to check the backgrounds of investment 

advisory firms through the SEC’s Investment Adviser Public Disclosure (IAPD) system. This 

measure would gauge the demand for disclosure information about broker-dealers and their 

employees through the BrokerCheck website and about investment advisers through the IAPD.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

BrokerCheck System

Prior-year data not 

available N/A N/A TBD TBD

IAPD System

Prior-year data not 

available N/A N/A TBD TBD
- 38 -

Goal 3: Measure 6

Investor demand for disclosures on municipal securities

Description: Greater availability of market-sensitive information through the Municipal 

Securities Rulemaking Board’s Electronic Municipal Market Access (EMMA) website will 

provide investors with the ability to make better-informed investment decisions and assist market 

participants in fulfilling their disclosure obligations. This measure gauges the demand for

disclosure information about municipal securities through the EMMA website.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Web Site Hits

Prior-year data not 

available N/A N/A NA NA

Goal 3: Measure 7

Satisfaction index for disclosure process

Description: The agency will conduct survey research or focus groups to identify the level of 

satisfaction with disclosure requirements.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Satisfaction Index

Prior-year data not 

available N/A N/A TBD TBD

Outcome 3.2: Agency rulemaking and investor education programs are informed 

by an understanding of the wide range of investor needs.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: 

Investors who have access to complete and accurate information are more likely to invest 

wisely. In FY 2012, the Office of Investor Education and Advocacy (OIEA) will continue 

to focus on educating investors about products commonly marketed to them and provide 

educational programs and materials to help investors detect and avoid potential scams. 

OIEA plans to reach 15 million investors through various communication methods 

(Measure 8), and partner with other federal and state agencies, financial industry 

associations, consumer groups, and educational organizations to produce 11 education 

campaigns (Measure 9). This level of outreach is expected to improve and expand the 

SEC’s investor education program, and the agency will gauge the usefulness of its 

outreach efforts through focus groups and surveys (Measure 12). 

In addition to providing educational materials to investors, OIEA plans to provide 

comments and guidance on several rulemaking initiatives derived from the Dodd-Frank 

Act, including business conduct rules for hedge fund managers and fiduciary duties of 

investment advisers and brokers. Furthermore, OIEA will continue to respond to 

investment-related complaints and questions from tens of thousands of investors each 

year. The staff strives to close all inquiries and complaints in a timely manner, often 

working with other SEC offices and divisions, as well as other regulators and firms, to 
- 39 -

resolve matters. In FY 2012, staff members plan to close 80 percent of complaints and 

inquiries within seven days and 90 percent within 30 days (Measure 10). 

Goal 3: Measure 8

Number of investors reached, and number of in-person events with specifically targeted 

communities and organizations

Description: The agency 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. Much of this information is posted on the SEC’s Investor Information Web page, a key 

tool for informing and educating the investing public. In addition, the Office of Investor Education 

and Advocacy publishes hard-copy educational brochures and conducts in-person events. This 

measure seeks to determine the total number of investors reached by the SEC, and assess the 

effectiveness of outreach efforts conducted by OIEA and the regional offices targeted to specific 

investor groups (for example, seniors, military, or other affinity groups). The measure also captures 

the use of various channels to reach investors, such as the SEC webpage, investor.gov, social 

networking sites, outreach programs, or public appearances.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Number of Investors 

Reached (millions)

Prior-year data not 

available 17.3 17.8 16 15 

Number of “In-Person” 

Events Prior-year data not 

available 25 42 30 35

Goal 3: Measure 9

Number of investor educational initiatives organized and produced

Description: In partnership with other organizations, the agency will develop a number of 

educational campaigns intended to customize content and maximize its reach to various investor 

communities. Through the use of primary and secondary research including tracking emerging 

investor concerns and complaints, the agency will continue to assess how to best target its efforts to 

the investing public. This measure identifies the number of major investor initiatives undertaken.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Number of Initiatives

Prior-year data not 

available 8 9 10 11
- 40 -

Goal 3: Measure 10 

Timeliness of responses to investor contacts

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

investment-related complaints and questions. The staff aims to close out as many new investor 

assistance matters within seven and 30 business days. 

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Closed within 7 days

Total 82% 78% 70% 80% 72% 80% 80%

Closed within 30 days

Total 94% 88% 90% 90% 93% 90% 90%

Goal 3: Measure 11

Percentage of rules impacting investors that are presented in alternate user-friendly formats

Description: The agency intends to publish explanations of Commission actions in easily 

understandable language, to encourage investor participation and comments on issues materially 

affecting them. The Office of Investor Education and Advocacy also will track emerging concerns and 

trends and then work with the rulemaking divisions and other offices on possible regulatory responses. 

The SEC also may use surveys or questionnaires to collect input from investors to assist in assessing 

their views on Commission actions. 

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Percentage

Prior-year data not 

available 100% 100% 100% 100%

Goal 3: Measure 12

Customer satisfaction with usefulness of investor educational programs and materials

Description: Through the use of focus groups and surveys, the agency will assess the usefulness of 

educational material provided to investors across a variety of channels based upon ease of use, 

appropriateness, and other factors.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 

2010 

Actual

FY 

2011

FY 

2012

Satisfaction Index

Prior-year data not 

available N/A N/A TBD TBD
- 41 -

Goal 4: Maximize the Use of SEC Resources

The investing public and the securities markets are best served by an efficient, well-managed, 

transparent and proactive SEC. To further the agency’s efforts to improve its organizational 

effectiveness, the Office of the Chief Operating Officer (OCOO) was established in FY 2010 to help 

the agency more efficiently and effectively utilize its resources by overseeing the Office of Information 

Technology (OIT), the financial and accounting functions of OFM, and the Office of FOIA and 

Records Management Services. In FY 2012, the SEC will focus on effectively implementing the 

increase in the SEC’s workforce contemplated in this request. In addition, the SEC will continue to 

implement the requirements of the Government Efficiency, Effectiveness, and Performance 

Improvement Act of 2010. Requirements outlined in the Act will focus on providing agency 

management with improved information on measurable performance results in order to support 

effective resource management. In FY 2012, the SEC plans to devote approximately $177 million and 

575 permanent FTE to achieve Goal 4. 

Chart 6

Outcome 4.1: The SEC maintains a work environment that attracts, engages, and retains a 

technically proficient and diverse workforce that can excel and meet the dynamic challenges of 

market oversight.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: The SEC’s 

employees are its most vital strategic resource, and the agency works hard to attract and retain a highquality, diverse, and results-oriented workforce. The Office of Human Resources (OHR) supports the 

agency’s efforts by providing organizational leadership for the strategic management of human capital, 

and is working to integrate human capital systems for candidate selection, personnel performance 

management, and employee development. The SEC’s increased staffing request in FY 2012 will 

require OHR to accelerate hiring significantly. In order to meet these requirements, the agency is 

requesting an additional 29 positions (22 FTE) for OHR. 

OHR’s new programs are expected to help the agency maintain high employee satisfaction as well as 

keep the agency’s turnover rate below eight percent in FY 2012 (Measure 3). The agency formed the 

Labor Management Forum to monitor and develop additional action plans to regain its top five ranking 

as one of the best places to work in the federal government (Measure 2), and the agency will continue 

to refine a series of programs to enhance employee engagement (Measure 1).

Agency Direction & Administrative Support (89%)

General 

Counsel (5%)

General 

Counsel (5%)

Other Program

Offices (1%)

Other Program 

Offices (1%)

Risk Strat. & 

Fin Innov. (2%)

Inspector 

General (4%) Inspector 

General (4%)

Agency Direction & Administrative Support (88%)

Risk Strat. & 

Fin.Innov. (1%)

FY 2012 Request ($ in thousands)

$176,709 Total Cost

FY 2012 Request (Permanent FTE)

575 Total FTE
- 42 -

Additionally, by the end of FY 2011, OHR plans to implement an automated learning management and 

performance management system to develop baselines and begin tracking learning programs, 

certifications, and competency gaps (Measure 4 and Measure 5).

Goal 4: Measure 1 

Survey of employee engagement

Description: The SEC strives to maintain a culture in which employees demonstrate a strong 

personal, positive connection with the organization and its mission and strategic goals. This 

connection, which can be called “employee engagement,” can result in higher-quality work, 

willingness to lead or participate in special projects, sharing job knowledge with others, mentoring 

other staff, or other positive contributions to the agency and its work. This index will be drawn 

from annual survey results and will track the agency’s success in improving employee engagement.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Biennial index score

Prior-year data not 

available 65% 58% 65% 65%

Goal 4: Measure 2 

Best Places to Work ranking 

Description: This annual ranking of federal government agencies will be used to determine the 

SEC’s overall success in improving our organizational climate.

Fiscal Year

FY 

2007

FY 

2008 

FY 

2009 

FY 

2010

Plan 

FY 2010 

Actual

FY 

2011 

FY 

2012

Ranking number

Ranked 

#3

Ranked 

#3

Ranked 

#11

 

Ranked 

#5 

Ranked 

#24 #5 #5

Goal 4: Measure 3 

Turnover

Description: The SEC strives to maintain an organizational climate in which high-performing 

employees wish to remain. Although turnover can fluctuate based on a variety of factors, including 

the health of the economy and the number of outside job opportunities available for SEC staff, the 

agency aims to keep its turnover rate relatively low, below 8 percent per year.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Percent turnover 8.8% 6.2% 3.7% <8% 5% <8% <8%
- 43 -

Goal 4: Measure 4

Expanding staff expertise

Description: Internal training and hiring programs are designed to help the agency recruit and 

develop its staff so that key skills, industry knowledge, and expertise are maintained. In particular, 

there is a need to hire more economists, trading specialists, and other experts with knowledge of 

the marketplace and both investment and trading practices. Annual agency training goals and 

hiring practices are focused on ensuring staff have the necessary capabilities to address trends in 

the industry. This measure tracks whether certain areas requiring significant training are being 

addressed.

For example, the agency will monitor the percentage of staff that has received or maintained 

significant relevant training as measured by achieving the status of a Certified Fraud Examiner, 

Chartered Financial Analyst, Series 7, or other relevant industry designations.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Percent of staff with industry 

designations

Prior-year data not 

available N/A N/A TBD TBD 

Goal 4: Measure 5

Size of competency gaps

Description: Key competencies will be rated as part of the SEC’s performance management 

process. Once the SEC has implemented a technology system to support the performance 

management program, the agency will assess its baseline competency gaps annually and work to 

bring them down over time.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Percentage reduction for the 

size of competency gaps

Prior-year data not 

available 10% N/A 10% 10% 

Goal 4: Measure 6

Number of diversity-related partnerships/alliances

Description: Increased numbers of diversity-related partnerships or alliances with professional 

associations and educational organizations provide opportunities to educate students about the 

SEC’s work and recruit career professionals from all segments of society. The SEC will track the 

number of partnerships and/or alliances with diverse professional associations and educational 

organizations.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Number of 

partnerships/alliances

Prior-year data not 

available 1 2 5 8
- 44 -

Goal 4: Measure 7

Survey feedback on the quality of the SEC’s performance management program

Description: The SEC will construct an index from survey results to determine the extent to 

which managers and other employees find the performance management program valuable, 

credible, transparent, and fair.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Percentage of positive 

survey responses

Prior-year data not 

available 65% N/A 65% 65% 

Outcome 4.2: The SEC retains a diverse team of world-class leaders who provide motivation 

and strategic direction to the SEC workforce.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: As part of the FY 

2010 strategic planning process, the SEC developed new measures to gauge its progress in increasing 

staff training and development so that each employee can achieve and maintain the highest level of 

performance. The new measures also are expected to ensure the continued construction and 

implementation of a comprehensive leadership development program (Measure 9 and Measure 10). 

Specific aspects of the program include training for new supervisors, building skills in change 

management, increasing the number and scope of developmental opportunities for all leaders, and 

instituting a program to prepare non-supervisors to assume supervisory roles.

Goal 4: Measure 8

Quality of Hire

Description: Data related to each new hire will be gathered from either the immediate supervisor 

or the selecting official, as appropriate. Data will be gathered three months after entry on board. 

This early assessment will not only inform the agency’s selection system, but will provide an 

opportunity to address quickly any developmental needs or performance issues.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Percentage of hires rated at 

least four on a five-point 

scale

Prior-year data not 

available 75% N/A 75% 75% 

Goal 4: Measure 9

Leadership Competency Gaps

Description: A 360-degree feedback survey will be conducted across all leadership ranks. This 

will provide an SEC-wide score on each competency measured in the survey. The gap will be 

determined by subtracting the obtained scores from expected proficiency levels on key 

competencies. Progress will be determined by comparing this baseline to scores obtained from 

subsequent administrations of the survey.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Average percentage of gaps 

reduced in each survey

Prior-year data not 

available 10% N/A 10% 10% 
- 45 -

Goal 4: Measure 10

Satisfaction with Leadership Development Program

Description: After each major developmental event participants will complete a survey of items 

related to key training outcomes. Responses to these items will be compiled to create a composite 

score.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Average score on a fivepoint scalePrior-year data not 

available 4 4.46 4.5 4.5

Outcome 4.3: Information within and available to the SEC becomes a Commission wide shared 

resource, appropriately protected, that enables a collaborative and knowledge-based working 

environment.

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: OIT supports the 

agency’s use of technology to modernize agency-wide mission performance. As a result of the 

increasing size and complexity of the U.S. securities markets as well as the requested increase in SEC 

staff, the agency is expecting an increased demand for the technical capability to electronically access, 

retrieve, organize, and analyze relevant information. OIT is requesting an additional 60 positions 

(20 FTE) to implement requirements contained in the Dodd-Frank Act, support agency-wide data 

management and integration, and improve the agency’s disclosure systems, infrastructure, and 

management of projects.

As the SEC significantly expands its staff in order to keep pace with the growing number and 

complexity of registered firms, OIT will continue to experience an increased demand for technical 

capabilities to electronically access, retrieve, and organize relevant data that is often contained in both 

structured and unstructured formats in a variety of documents and databases. The SEC will use 

Measure 11 and Measure 12 to gauge its progress in developing a robust data integration and 

management program, and modernizing IT systems for the Enforcement program and the national 

examination program.

The SEC must have the technical capability to electronically organize and retrieve an extraordinary 

volume of documents obtained in the conduct of investigations. In FY 2012, OIT will work closely 

with the Division of Enforcement to improve the agency’s document storage, organization, and 

analytic capabilities. The SEC will use Measure 13 to track development of technologies that will 

enable Enforcement staff to investigate and litigate more efficiently, proactively, and intelligently.
- 46 -

Goal 4: Measure 11

Percentage of SEC data sources accessible through a virtual data warehouse, and milestones 

achieved towards the creation of a robust information management program

Description: The SEC intends to reform its information management processes, so that data can be 

more easily accessed, shared, and analyzed across the organization. This metric will display the 

percentage of SEC data sources accessible for search and analysis through a virtual data warehouse. 

In addition, the SEC will track its success in achieving relevant milestones over the course of this 

multi-year effort. These milestones include establishing a formal information management program 

in 2010, completing an information catalog by 2011, providing capabilities to support analysis of 

information by 2012, and developing a capability that allows integration of business operations data 

for management, reporting and analysis by 2013.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Percentage Prior-year data not available N/A N/A TBD TBD

Goal 4: Measure 12

Deployment of document management and workflow tools

Description: This metric will present the SEC’s success in applying document management and 

workflow tools to the Commission’s mission critical business functions. Over time, the SEC aims to 

deploy these tools for enforcement case management, the agency’s processes for handling 

disgorgement and penalties, examination management, management of Commission actions, and 

rulemaking.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Business 

functions 

served

Prior-year data not 

available

 

Enforcement 

& 

Examination

Enforcement 

& 

Examination

Tips, Complaints and 

Referrals Commissionwide TBD

Goal 4: Measure 13

Time to process evidentiary material for enforcement investigations

Description: The SEC aims to improve its ability to process evidentiary material gathered during the 

course of its enforcement investigations, and enhance the agency’s document storage, organization, 

and analytical capabilities. This metric will gauge whether these efforts succeed in reducing the time 

required to process evidentiary material, so it can be analyzed by enforcement staff.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Time to 

process Prior-year data not available N/A N/A 

Pilot 

Software

Begin Metrics 

Reporting
- 47 -

Goal 4: Measure 14

System Availability

Description: The SEC aims to enhance its computing infrastructure to eliminate down time if 

systems at one site fail, among other objectives. This metric will capture the percentage of systems 

and applications that can fail over within 4 hours. In addition, the SEC will track the percentage of its 

systems that have been virtualized, further reducing down time and increasing their accessibility from 

alternative locations.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Systems availability Prior-year data not available 99% 99.97% 99.3% 99.5%

Percentage fail over 

within four hours Prior-year data not available 100% N/A TBD TBD

Systems virtualized Prior-year data not available N/A 22% 25% 30%

Outcome 4.4: Resource decisions and operations reflect sound financial and risk management 

principles. 

Performance Analysis & Means and Strategies Used to Achieve Performance Goals: Given the SEC’s 

statutory role in overseeing the disclosures of public companies and investment funds, taxpayers and 

investors should expect that the agency will maintain strong financial management practices and robust 

internal controls over its own operations. As a result, the agency places great emphasis on vigorously 

bolstering its processes and systems that support its budgeting, accounting, and internal controls 

functions. 

In FY 2012, the SEC plans to complete the migration its financial system to a federal government 

Shared Service Provider (SSP), the Enterprise Services Center at the Department of Transportation. 

This effort will allow the agency to transfer its financial system into a strong, proven security 

environment, and eliminate several manual processes for financial reporting and accounting. The SEC 

will use Measure 16 to gauge its progress in achieving this initiative. Along with efforts in FY 2011 

and FY 2012 to migrate to a SSP, OFM also will pursue next generation tools for managing budget 

formulation and execution, as well as performance measurement and reporting. 

The SEC will continue strengthening internal controls, developing complete and accurate financial 

statements, and increasing transparency of financial and operational information. The staff strives to 

maintain the highest standards of financial reporting, and will aim to receive an unqualified audit 

opinion on the SEC’s financial statements and have no material weaknesses or significant deficiencies 

(Measure 17).
- 48 -

Goal 4: Measure 15

Milestones achieved towards establishment of a robust data management program

Description: A business process improvement effort will be initiated to identify enhancements 

needed to create a robust data management program over the next five years. This metric will 

gauge the agency’s success in establishing an integrated enterprise data management, reporting, 

and analysis capability for mission and back office data.

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Milestone 

achieved

Prior-year data not 

available

 Administrative 

data and 

reporting 

requirements 

identified N/A TBD TBD

Goal 4: Measure 16

Financial systems integration

Description: As part of the SEC’s effort to integrate its financial systems, the agency will measure 

the percentage of secondary systems that are fully interfaced with the core financial system, in 

compliance with applicable standards. 

Fiscal Year

FY

2007

FY

2008

FY 

2009

FY 2010

Plan

FY 2010 

Actual

FY 

2011

FY 

2012

Percentage Prior-year data not available 17% N/A TBD TBD

Goal 4: Measure 17

Financial audit results

Description: Under the Accountability of Taxpayer Dollars Act of 2002, the agency is required to 

meet all proprietary and budgetary accounting guidelines for federal agencies and to undergo annual 

audits. The SEC’s audits are conducted by the Government Accountability Office.

Fiscal Year

FY

2007

FY

2008

FY

2009

FY 2010

Plan

FY 2010

Actual

FY 

2011

FY 

2012

Unqualified Opinion Yes Yes Yes Yes Yes Yes Yes

Material Weaknesses 1 0 1 0 2 0 0

Significant Deficiency 3 3 6 0 0 0 0
- 49 -

Division of Enforcement

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 435 458 510

 Regions 738 778 856

 Total 1,173 1,236 1,366

Cost: Salaries and Benefits ($000) $228,792 $246,627 $277,573 

 Non-Personnel Expenses ($000) 132,858 138,033 178,153 

Total Costs ($000) $361,650 $384,660 $455,726 

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

1,366

A strong Division of Enforcement is critical to the investing public’s confidence in the integrity of the 

markets. The division investigates and brings civil charges in federal district court or in administrative 

proceedings based on violations of the federal securities laws. An integral part of the Enforcement 

program is to seek penalties and the disgorgement of ill-gotten gains in order to return funds to harmed 

investors.

To maintain an effective investigative capacity and deterrent presence, the Enforcement program must 

be adequately staffed to address increasingly complex financial products and transactions, handle the 

increasing size of the markets, take prompt action to halt violations, and recover funds. The SEC is 

committed to strengthening the Enforcement program through, among other things, the addition of 

156 positions (associated with 122 FTE) in FY 2012. These positions will support the Enforcement 

program’s current initiatives by:

• Increasing staff for the Office of Market Intelligence (OMI), which is responsible for the 

collection, analysis, risk-weighing triage, referral and monitoring of the thousands of tips, 

complaints and referrals that the Agency receives each year; 

• Expanding and focusing the investigative function to promptly identify areas appropriate for 

enhanced investigative efforts;

• Continuing to strengthen the litigation function by improving its ability to successfully 

prosecute a growing number of enforcement actions with increased complexity; 

• Increasing staff for the Office of Collections and Distributions, which is responsible for 

collecting ordered penalties and disgorgement amounts, and returning funds to harmed investors 

whenever possible; and

• Expanding staff in Enforcement’s information technology (IT) group to assist in the 

implementation of various initiatives focused on improving efficiency.
- 50 -

Office of Compliance Inspections and Examinations

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 150 148 177

 Regions 704 706 825

 Total 854 854 1,002

Cost: Salaries and Benefits ($000) $162,093 $167,960 $201,209 

 Non-Personnel Expenses ($000) 76,377 72,042 102,649 

Total Costs ($000) $238,470 $240,002 $303,858 

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

1,002

The Office of Compliance Inspections and Examinations (OCIE) conducts the SEC’s national 

examination program. Staff examinations are designed to: (1) improve compliance; (2) prevent fraud; 

(3) monitor risk; and (4) inform regulatory policy. To this end, the results of OCIE’s examinations are 

utilized by the Divisions of Investment Management and Trading and Markets to inform rule-making 

initiatives, by the Division of Risk, Strategy and Financial Innovation to identify and monitor risks, 

and by the Division of Enforcement to pursue misconduct.

In FY 2012, additional resources are critical in order for OCIE to meet its objectives and fulfill the 

agency’s mission. In particular, resources are needed to continue implementation of certain provisions 

of the Dodd-Frank Act; address the disparity between the number of exam staff and the growing 

number and complexity of registered firms; and more effectively risk target, monitor, and examine 

market participants. OCIE also will enhance training and expertise of examiners in fraud detection, 

new products, trading strategies and other issues, and will continue ongoing efforts to improve its risk 

assessment and surveillance methodologies. Additionally in FY 2012, OCIE will continue to promote 

industry compliance efforts through the CCOutreach program. The office requests an additional 195

positions (associated with 145 FTE) to accomplish these goals.
- 51 -

Division of Corporation Finance

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 470 465 503

Cost: Salaries and Benefits ($000) $90,474 $90,666 $100,111 

 Non-Personnel Expenses ($000) 44,661 46,376 57,697 

Total Costs ($000) $135,135 $137,042 $157,808 

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

10 65 428

The Division of Corporation Finance (CF) has two primary missions: to see that investors are 

provided with materially complete and accurate information and to deter fraud and misrepresentation 

in the public offering, trading, voting, and tendering of securities. The division’s primary authority is 

derived from three statutes: the Securities Act of 1933 (1933 Act), the Securities Exchange Act of 

1934 (1934 Act), and the Sarbanes-Oxley Act of 2002.

In FY 2012 the division plans to enhance its reviews of public company filings and to focus more, and 

on an ongoing basis, on disclosures made by large and financially significant companies. The division 

also plans to enhance its reviews of offering documents to remain current with offering and financing 

trends and enhance its reviews of asset-backed and other structured finance offerings. Additionally, 

the division plans to prepare proposals to update the general disclosure requirements applicable to 

public companies, prepare proposals to update beneficial ownership reporting rules in light of market 

developments such as equity swaps and other derivatives, and continue rulemaking efforts to adopt 

new disclosure requirements for complex financial instruments such as asset-backed securities. 

Although the division began efforts in each of these areas in FY 2011, it has redirected substantial 

resources to rulemaking efforts mandated by the Dodd-Frank Act. The staff will undertake 

information technology (IT) projects to modernize disclosure forms and the Electronic Data Gathering, 

Analysis and Retrieval (EDGAR) system. In FY 2012, the division plans to continue to meet the 

review cycle requirements of the Sarbanes-Oxley Act, monitor the amount of time attributed to staff 

review, and process in a timely manner all requests for confidential treatment associated with these 

filings. 

The division requests 50 additional positions (38 FTE) in FY 2012 to meet its goals.
- 52 -

Division of Trading and Markets

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 191 214 272

Cost: Salaries and Benefits ($000) $38,010 $43,020 $55,122 

 Non-Personnel Expenses ($000) 17,645 18,657 29,571 

Total Costs ($000) $55,655 $61,677 $84,693 

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

46 147 79

The mission of the Division of Trading and Markets (TM) is to establish and maintain standards for 

fair, orderly, and efficient markets, while fostering investor protection and confidence in the markets. 

In furtherance of this mission, TM is requesting 80 additional positions (associated with 60 FTE) in

FY 2012. These additional resources will enable the Division to begin to assume the significant new 

responsibilities required of it under the Dodd-Frank Wall Street Reform and Consumer Protection Act 

(Dodd-Frank Act), while allowing it to continue to provide and enhance its existing supervision of 

securities firms and markets.
- 53 -

Division of Investment Management

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 157 157 181

Cost: Salaries and Benefits ($000) $32,214 $32,843 $38,190 

 Non-Personnel Expenses ($000) 17,771 18,126 24,189 

Total Costs ($000) $49,985 $50,969 $62,379 

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

43 86 52

The mission of the investment management program is to minimize the financial risks to investors 

from fraud, mismanagement, self-dealing, and misleading or incomplete disclosure in the investment 

company and investment adviser segments of the financial services industry, without imposing 

unnecessary costs and burdens on regulated entities.

In FY 2012, the Division of Investment Management (IM) plans to provide recommendations for the 

proposal and adoption of rules to implement provisions of the Dodd-Frank Act, and will monitor the 

effect of the SEC’s implementation of such provisions, specifically with respect to the registration of, 

and reporting by investment advisers to private investment funds. IM also expects to inaugurate a 

program to conduct compliance inspections and examinations of investment companies and investment 

advisers. 

IM will also devote substantial resources to: 1) addressing interpretive issues in connection with final 

rules under the legislation, including administering exemptions from the registration requirement under 

the Investment Advisers Act of 1940 for advisers to venture capital funds, other private funds, and 

family offices; and 2) support the SEC’s participation in the Financial Stability Oversight Council 

(FSOC). Many of FSOC’s statutory duties relate to collecting and facilitating the sharing of 

information among financial regulatory agencies. IM will assist in overseeing the collection of 

systemic risk information that will be filed by private fund advisers beginning in late FY 2011.

In FY 2012, IM expects to improve the monitoring of money market funds by growing its surveillance 

team and analyzing expanded monthly portfolio holdings data it began collecting in FY 2011. IM 

plans to recommend additional reforms aimed at further improving the regulatory regime for money 

market funds, lessening their susceptibility to runs, and enhancing the protections afforded to money 

market fund investors. IM requests 31 additional positions (associated with 23 FTE) in FY 2012 to 

accomplish these goals.
- 54 -

Division of Risk, Strategy and Financial Innovation

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 47 60 86

Cost: Salaries and Benefits ($000) $11,499 $14,198 $19,601 

 Non-Personnel Expenses ($000) 8,363 7,132 11,575 

Total Costs ($000) $19,862 $21,330 $31,176 

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

27 43 9 7

The Division of Risk, Strategy, and Financial Innovation (RSFI) provides sophisticated analysis that 

integrates economic, financial, and legal disciplines with data analytics and quantitative 

methodologies. The Division’s responsibilities cover three broad areas, each infused with rigorous 

quantitative analysis: risk and economic analysis; strategic research; and financial innovation. Its 

responsibilities include providing economic analyses of proposed Commission actions and providing 

expertise in analytical approaches and methods in support of the agency’s enforcement and 

examinations program. In its “think tank” and other roles, RSFI is involved across the entire range of 

SEC activities, including policymaking, rulemaking, enforcement, examination, data standards and 

analytics, and other matters.

RSFI requests an additional 32 positions (associated with 24 FTE) in FY 2012. As a result, RSFI will 

have a staff of 96, including a significant number of visiting academics and industry experts. 

Approximately half of the increased resource allocation is projected to be devoted towards supporting 

implementation and on-going activities mandated by the Dodd-Frank Act, while the remainder will 

support the Division’s operations and on-going tasks of risk and economic analysis, strategic research, 

financial innovation, and development of data analytics and quantitative methodologies—much of 

which has been diverted or deferred in order to meet the requirements of the Dodd-Frank Act.

RSFI will continue to monitor market developments, conduct outreach to market participants, and 

enhance risk-based methods for maximizing resources throughout the SEC. Staffing increases will 

allow the Division to better support the Office of Compliance Inspections and Examinations (OCIE) in 

its efforts to improve systems for surveillance, risk-based targeting of examinations, and data analysis 

capabilities. The additional personnel will provide economic and statistical analysis that identifies 

potential violations and that supports the prosecution of violations, as well as to provide support for the 

existing interactive data program. Additionally, in FY 2012, the Division expects to continue 

providing analyses for a number of issues being considered for legislative action, as well as analyses of 

the impact of existing legislation on investors and regulated entities. 
- 55 -

Office of the General Counsel

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 128 134 152

 Regions 11 11 11

 Total 139 145 163

Cost: Salaries and Benefits ($000) $29,805 $31,219 $35,410 

 Non-Personnel Expenses ($000) 13,327 13,321 17,547 

Total Costs ($000) $43,132 $44,540 $52,957 

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

104 26 5 28

The General Counsel serves as the chief legal officer of the Commission and provides independent 

legal analysis and advice to the Chairman, Commissioners, and operating divisions on all aspects of 

the Commission’s activities. The General Counsel also defends the Commission in federal district 

courts, represents the Commission in all appellate matters and amicus curiae filings, and oversees the 

SEC’s bankruptcy program.

In FY 2012, the Office of the General Counsel (OGC) anticipates continued work on legislative 

initiatives to reform the existing regulatory structure for the securities markets and the financial 

services industry. An increased staff of experienced attorneys will be needed to handle complex

agency and securities law issues which will result from regulatory reform and address legal challenges 

to rulemakings. OGC also expects to provide technical assistance to Congress and other financial 

regulatory agencies on numerous legislative initiatives and other matters. The requested increase in 

the size of the enforcement staff is expected to lead to an increase in the number of enforcement 

matters that will reach adjudication as appeals, as well as an increase in the number and time 

sensitivity of the enforcement actions analyzed by OGC staff. 

Ethics counseling matters are expected to rise, in large part due to the overall increase in SEC staff. 

The Ethics Office assumed responsibility for all agency financial disclosure requirements, including 

review of the staff’s security transactions in FY 2010. The office implemented a new electronic ethics 

and compliance system in early FY 2010 and established a compliance branch in late FY 2010. 

The office is requesting 23 additional positions (associated with 17 FTE) in FY 2012 to address 

expanding requirements and additional workload generated by increasing staffing levels across the 

agency.
- 56 -

Other Program Offices

This section of the SEC’s request includes chapters that describe the responsibilities and activities of 

the agency’s smaller program offices, including:

Office of Chief Accountant: Establishes accounting and auditing policy and works to improve the 

professional performance of public company auditors to ensure that financial statements used for 

investment decisions are presented fairly and have credibility.

Office of Investor Education and Advocacy: Serves investors who complain to the SEC about 

investment fraud or the mishandling of their investments by securities professionals. The SEC has 

significantly expanded the office’s responsibilities to ensure the views of retail investors inform the 

Commission’s regulatory policies and disclosure programs and to improve investors’ financial literacy.

Office of International Affairs: Advances international regulatory and enforcement cooperation, 

promotes converged high regulatory standards worldwide, and facilitates technical assistance programs 

in foreign countries. 

Office of Administrative Law Judges: Adjudicates allegations of securities law violations.

Office of the Investor Advocate: Provides assistance to investors in resolving significant problems 

they may have with the SEC or with self-regulatory organizations (SROs), and identifying areas in 

which investors would benefit from changes to federal laws or to SEC regulations or SRO rules.

Office of Credit Ratings: Administers the rules of the Commission with respect to the practices of 

nationally recognized statistical rating organizations (NRSROs) in determining ratings; protects the 

users of credit ratings; promotes accuracy in credit ratings issued by NRSROs; and ensures that such 

ratings are not unduly influenced by conflicts of interest.

Office of Municipal Securities: Administers the rules of the Commission with respect to the practices 

of municipal securities brokers and dealers, municipal advisors, and investors in, and issuers of, 

municipal securities. The office also coordinates with the Municipal Securities Rulemaking Board 

(MSRB) on rulemaking and enforcement actions. 

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters

 Office of Chief Accountant 55 52 57

 Office of Investor Education and Advocacy 71 45 53

 Office of International Affairs 34 36 46

 Office of Administrative Law Judges 10 10 11

 Office of the Investor Advocate 0 3 6

 Office of Credit Ratings 0 5 28

 Office of Municipal Securities 0 2 5

 Total 170 153 206

Cost: Salaries and Benefits ($000) $31,872 $31,124 $42,035 

 Non-Personnel Expenses ($000) 17,322 18,618 27,147 

Total Costs ($000) $49,194 $49,742 $69,182 
- 57 -

Office of Chief Accountant

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 55 52 57

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

19 22 11 5

The Office of the Chief Accountant (OCA) is responsible for establishing and interpreting accounting 

policy to enhance the transparency and relevancy of financial reporting for investors. OCA works to 

improve the professional performance of public company auditors to ensure that financial statements 

used for investment decisions are presented fairly and have credibility. OCA leads the SEC’s efforts to 

oversee accounting-standard setting by the Financial Accounting Standards Board (FASB), and auditor 

oversight and standard-setting by the Public Company Accounting Oversight Board (PCAOB).

In FY 2012, OCA requires additional resources to foster progress towards development of a single set 

of high-quality, globally accepted accounting standards, to oversee the FASB and PCAOB, and to 

conduct market surveillance in the newly created Office of Policy and Market Risk. The office is 

requesting six additional positions (associated with four FTE) in FY 2012.
- 58 -

Office of Investor Education and Advocacy

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 71 45 53

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

5 8 38 2

Understanding the needs and concerns of investors is critical to carrying out the SEC’s investor 

protection mission. The Office of Investor Education and Advocacy (OIEA) advances this mission by 

communicating daily with investors, responding to their complaints and inquiries, and providing 

educational programs and materials.

In FY 2012, OIEA plans to expand its research on various categories of investors and investment 

decision-making behavior. This research will drive the development of educational programs and 

materials and help inform the Commission’s rulemaking agenda. OIEA plans to shorten response 

times for investor contacts and improve quality assurance. The office estimates it will manage 

approximately 2,000 more investor assistance activities compared to FY 2011. Additionally, OIEA 

plans to continue to update its publications, expand its offering of Spanish language publications and 

explore new channels for communicating with investors. To implement new initiatives and address 

increasing workloads, OIEA requests 11 additional positions (associated with eight FTE) in FY 2012.
- 59 -

Office of International Affairs

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 34 36 46

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

28 15 3

The Office of International Affairs (OIA) assists the Commission in meeting its mandate by advancing 

cross-border supervisory and enforcement cooperation, advising the agency on developing and 

modernizing regulatory policy to reflect the global nature of securities activity, and providing technical 

assistance to emerging markets.

One of OIA’s core functions is to assist the enforcement program on cross-border investigations and to 

foster investor protection in a global environment. In FY 2011, over 30 percent of all SEC 

enforcement investigations had a cross-border component, and OIA staff utilized its foreign law 

expertise to obtain foreign information for the Enforcement program. In FY 2012, Enforcement cases

are projected to continue to have international elements and be more complex as fraudsters try to use 

new methods to secrete ill-gotten gains. OIA will continue to use dedicated staff to compel 

information located in the U.S. on behalf of foreign authorities.

In FY 2012, it will also be increasingly important to enhance supervisory cooperation and evaluate 

implementation of comparable foreign regulatory reforms and identify potential ramifications for the 

new U.S. regulatory regime. OIA will continue its efforts to develop bilateral supervisory cooperation 

memoranda of understanding (MOUs) and other arrangements with foreign regulatory authorities to 

facilitate cooperation in the oversight of entities regulated on a cross-border basis. OIA also will work 

cooperatively within the International Organization of Securities Commissions (IOSCO) and the 

Financial Stability Board (FSB) to enhance cross-border supervisory cooperation, as well as address 

systemic risk issues.

OIA requests 12 additional positions (associated with nine FTE) in FY 2012.
- 60 -

Office of the Administrative Law Judges

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 10 10 11

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

11

Pursuant to the Administrative Procedure Act and federal securities laws, administrative law judges 

preside at evidentiary hearings where the Commission has determined that public hearings are 

appropriate, in the public interest, and for protection of investors. The hearings are conducted in a 

manner similar to non-jury trials in federal court.

In FY 2012, the Office of Administrative Law Judges (OALJ) plans to dispose of roughly 140 

proceedings. For these proceedings, the OALJ expects to issue approximately 25 initial decisions. 

The office is requesting one additional position (one FTE) in FY 2012, commensurate with the planned 

increase in the enforcement program in FY 2012. 
- 61 -

Office of the Investor Advocate

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 0 3 6

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

6

The Office of the Investor Advocate is required by Sec. 915 of the Dodd-Frank Wall Street Reform 

and Consumer Protection Act (Dodd-Frank Act).1 The Office will be responsible for providing 

assistance to investors in resolving significant problems they may have with the SEC or with selfregulatory organizations (SROs), and identifying areas in which investors would benefit from changes 

to federal laws or to SEC regulations or SRO rules.

In FY 2011, the Office will be established with five positions, comprised of the Investor Advocate and 

Ombudsman, and three staff members transferred from the Office of Investor Education and 

Advocacy. For FY 2012, the SEC requests one additional position (associated with one FTE), for a 

total of six positions for the Office of the Investor Advocate, in order to permit it to perform the 

responsibilities identified in the Act. 

___________________

1 The SEC has submitted to the House and Senate Appropriations Committees a reprogramming request seeking approval to create this office. This budget 

chapter assumes congressional approval of this pending reprogramming request.
- 62 -

Office of Credit Ratings

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 0 5 28

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

28

The Office of Credit Ratings (OCR) is newly established by the SEC in FY 2011, as required by 

Sec. 932 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).1

 

OCR will be responsible for administering the rules of the Commission with respect to the practices of 

nationally recognized statistical rating organizations (NRSROs) in determining ratings, for protecting 

the users of credit ratings and in the public interest; promoting accuracy in credit ratings issued by 

NRSROs; and ensuring that such ratings are not unduly influenced by conflicts of interest. 

Additionally, OCR will be responsible for conducting examinations of each NRSRO at

least annually, and for issuing an annual public report that summarizes the essential findings resulting 

from these examinations. 

In FY 2011, OCR will be established with 11 positions, comprised of the director and 10 staff 

members transferred from the Division of Trading and Markets and the Office of Compliance 

Inspections and Examinations. For FY 2012, the SEC requests 24 additional positions (associated with 

17 FTE) for OCR, for a total of 35 positions, in order to permit it to satisfy the significant new 

requirements contained in the Act. These additional staff positions will be filled by individuals with 

knowledge of and expertise in corporate, municipal, and structured debt finance. 

___________________

1 The SEC has submitted to the House and Senate Appropriations Committees a reprogramming request seeking approval to create this office and assign 

an initial dedicated level of staff. This budget chapter assumes congressional approval of this pending reprogramming request.
- 63 -

Office of Municipal Securities

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 0 2 5

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

5

The Office of Municipal Securities (OMS), formerly part of the Division of Trading and Markets 

(TM), is being elevated to an independent office that reports directly to the SEC Chairman, as required 

by Sec. 979 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act).1

OMS is responsible for administering the rules of the Commission with respect to the practices of 

municipal securities brokers and dealers, municipal advisors, and investors in, and issuers of, 

municipal securities. OMS also coordinates with the Municipal Securities Rulemaking Board (MSRB) 

on rulemaking and enforcement actions. 

In FY 2011, OMS will be established with four positions, comprised of the director and three staff 

members transferred from the Division of Trading and Markets (TM). For FY 2012, the SEC requests 

one additional position (associated with one FTE) for OMS, for a total of five positions, in order to 

permit it to perform the responsibilities identified in the Act. 

____________________

1 The SEC has submitted to the House and Senate Appropriations Committees a reprogramming request seeking approval to create this office and its initial 

dedicated staff. This budget chapter assumes congressional approval of this pending reprogramming request.
- 64 -

Agency Direction and Administrative Support

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters

 Agency Direction

 Office of Executive Staff 38 41 43

 Office of Public Affairs 7 5 6

 Office of the Secretary 41 28 29

 Subtotal 86 74 78

 Administrative Support

 Office of the Executive Director 10 8 9

 Office of Financial Management

 - Budget and Planning 10 12 14

 Office of Human Resources 63 75 98

 Office of Administrative Services 93 105 119

 Office of the Chief Operating Officer 0 4 11

 Office of Financial Management

 - Accounting and Finance 50 57 63

 Office of Information Technology 125 116 137

 Office of FOIA/Records Management 1 41 44

 Office of Minority and Women Inclusion 0 3 8

 Office of Equal Emp. Opportunity 8 7 8

 Subtotal 360 428 511

 Total 446 502 589

Cost: Salaries and Benefits ($000) $90,396 $84,102 $105,623 

 Non-Personnel Expenses ($000) 52,246 63,571 77,024 

Total Costs ($000) $142,642 $147,673 $182,647 

This section of the FY 2012 request details the SEC’s agency-wide executive activities, operations, and 

administrative functions and covers the following areas:

Agency Direction: Includes the Chairman’s and Commissioners’ offices, Office of Legislative and 

Intergovernmental Affairs (OLIA), Office of Public Affairs (OPA), and Office of the Secretary.

Office of the Executive Director: Develops and executes agency management policies. The office 

oversees the allocation and utilization of agency resources, promotes management controls, and 

manages administrative support functions.

Office of the Chief Operating Officer: Facilitates and ensures the agency’s efficient and effective 

utilization of resources.

Office of Minority and Women Inclusion: Develops standards for all agency matters relating to 

diversity in management, employment, and business activities

Office of Equal Employment Opportunity: Ensures that employees and applicants for employment 

have equal opportunity in employment.
- 65 -

Agency Direction

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters

 Office of Executive Staff 38 41 43

 Office of Public Affairs 7 5 6

 Office of the Secretary 41 28 29

 Total 86 74 78

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

12 14 47 4

Agency Direction is comprised of the Commissioners and their staff, as well as the Office of the 

Secretary (OS), the Office of Legislative and Intergovernmental Affairs (OLIA), and the Office of 

Public Affairs (OPA). The Chairman’s Office oversees all aspects of agency operations, as well as the 

review and approval of enforcement cases and formal orders of investigation and the development, 

consideration, and execution of the agency’s substantive policy and rulemaking agenda. Matters such 

as the proposal or adoption of new rules or the consideration of enforcement cases or formal orders of 

investigations also involve the agency’s four other Commissioners and their staffs. 

OLIA works with Members of Congress and their staff on issues that affect the SEC and its mission, 

including the consideration of the agency’s funding and legislation that might affect the securities laws 

or other aspects of agency operations. OLIA also coordinates testimony of SEC officials and oversees 

correspondence sent between the Chairman and Members of Congress. OPA coordinates the SEC’s 

communications with the media, the general public, and foreign visitors. OS reviews all documents 

issued by the Commission, schedules Commission meetings, prepares and maintains records of 

Commission actions, advises the Commission and staff about practice and procedure, and maintains 

the library and related databases and content.

In FY 2011 and FY 2012, the Commission will work to strengthen the administration of the federal 

securities laws, protect investors, and implement regulations mandated by the Dodd-Frank Wall Street 

Reform and Consumer Protection Act. OPA plans to increase the agency’s use of new technologies 

and social media to further support the goal of open and transparent government. OS plans to better

manage administrative proceedings by implementing a new electronic filing system in FY 2012. 

Together, these two offices also intend to redesign the SEC’s external Web site to improve 

accessibility of information for investors, market participants, and SEC staff.

In total, these offices are requesting six new positions (three FTE) in FY 2012.
- 66 -

Office of the Executive Director

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters

 Office of the Executive Director 10 8 9

 Office of Financial Management

 - Budget and Planning 10 12 14

 Office of Human Resources 63 75 98

 Office of Administrative Services 93 105 119

 Total 176 200 240

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

1 1 238

The Office of the Executive Director (OED) aims to maximize the use of SEC resources by overseeing 

the financial management, human resources, and administrative functions of the agency. The Office of 

Financial Management (OFM) Planning and Budget Office is responsible for the SEC’s budgetary 

operations, as well as other managerial analysis and reporting. The Office of Human Resources 

(OHR) provides organizational leadership for strategic management of all aspects of the agency’s 

human capital program. The Office of Administrative Services (OAS) manages the agency’s physical 

infrastructure and provides a wide range of support services. 

Under the FY 2012 request, the SEC’s budget and workforce would grow significantly. OED and its 

subordinate offices will play a central role in supervising this growth, ensuring that the additional 

resources entrusted to the SEC are used wisely and efficiently. Towards this end, the offices will

oversee efforts to hire and train new staff as well as secure additional facilities to accommodate them. 

Altogether, the offices are requesting 52 additional positions (associated with 37 FTE) to support the 

mission programs’ expansion and effectively manage the agency’s resources and internal control 

processes.
- 67 -

Office of the Chief Operating Officer

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters

 Office of the Chief Operating Officer 0 4 11

 Office of Financial Management

 - Accounting and Finance 50 57 63

 Office of Information Technology 125 116 137

 Office of FOIA/Records Management 1 41 44

 Total 176 218 255

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

255

The Office of the Chief Operating Officer (OCOO) was established in FY 2010 to help the agency 

more efficiently and effectively utilize its resources. The OCOO is responsible for overseeing the 

Office of Information Technology (OIT), the financial and accounting functions of the Office of 

Financial Management, and the Office of FOIA and Records Management Services. 

Under the FY 2012 request, the SEC’s budget and workforce would see a significant increase. The 

OCOO offices will play a key role in providing much needed support to the agency. Altogether, the 

offices are requesting 80 additional positions (associated with 35 FTE) to support the mission 

programs’ expansion and effectively manage the agency’s resources.
- 68 -

Office of Minority and Women Inclusion

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 0 3 8

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

8

The Office of Minority and Women Inclusion (OMWI) is newly established by the SEC in FY 2011,

as required by Section 342 of the Dodd-Frank Act.1 OMWI will be responsible for all matters of the 

agency relating to diversity in management, employment, and business activities. Additionally, the 

director of this office advises the Chairman on the impact of the policies and regulations of the SEC

on minority-owned and women-owned businesses. The SEC requests seven additional positions 

(five FTE) in FY 2012 for the office in order to permit it to perform the basic responsibilities identified 

in the Act. 

____________________

1 The SEC has submitted to the House and Senate Appropriations Committees a reprogramming request seeking approval to create this office and assign 

an initial dedicated level of staff. This budget chapter assumes congressional approval of this pending reprogramming request.
- 69 -

Office of Equal Employment Opportunity

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 8 7 8

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

8

The Office of Equal Employment Opportunity (EEO) ensures that the SEC is an equal opportunity 

employer in full compliance with all federal EEO laws. These laws prohibit employment 

discrimination based on age, color, disability status, gender, national origin, race, religion, protected 

genetic information, sexual orientation, and discriminatory retaliation against individuals for 

participating in the EEO process or opposing discrimination. The EEO Office has also been 

responsible for promoting a diverse and inclusive working environment.

In FY 2012, in connection with the agency’s requested expansion of its staff, the EEO Office will 

increase its efforts to develop additional sources of diverse job applicants and will provide training and

instructional programs to more employees. The EEO Office anticipates receiving and processing 

inquiries and complaints from an increasing number of applicants and employees. In addition, the 

EEO Office will support compliance with EEO-related statutes and, as appropriate, the EEO and 

diversity-related components of the Dodd-Frank Act; continue supporting the Memorandum of 

Understanding (MOU) between the SEC and the National Treasury Employees Union (NTEU); and 

continue to develop diversity partnerships and alliances pursuant to the SEC’s strategic plan.

The office is requesting two additional positions (one FTE) in FY 2012 to address the increased 

workload. 
- 70 -

Office of the Inspector General

Executive Summary

FY 2010 FY 2011 FY 2012

Actual CR Request

FTE: Headquarters 17 18 20

Cost: Salaries and Benefits ($000) $3,365 $3,678 $4,019 

 Non-Personnel Expenses ($000) 2,457 2,542 3,038 

Total Costs ($000) $5,822 $6,220 $7,057 

FY 2012 FTE by SEC Strategic Goal

Goal 1 Goal 2 Goal 3 Goal 4

Foster and Enforce Establish an

Compliance Effective Facilitate Access Align and 

with Federal Regulatory To Information Manage 

Securities Laws Environment Investors Need Resources

20

The Office of Inspector General (OIG) is an independent office that conducts audits of programs and 

operations of the SEC and investigations into allegations of misconduct by agency staff or contractors. 

The mission of the OIG is to detect fraud, waste, and abuse and to promote integrity, economy, 

efficiency, and effectiveness in the SEC’s programs and operations. The rapid pace of significant 

internal and external changes that affect the work of the SEC drives the work of the OIG.

In FY 2012, the OIG will continue its focus on improving agency operations through audits, 

evaluations, and inspections. It also will enhance staff and agency integrity by investigating 

allegations of employee and contractor misconduct. By conducting audits, evaluations, inspections, 

and investigations, the OIG supports the efforts of Congress and the SEC to fulfill their responsibilities 

and achieve their goals and objectives with respect to oversight of the securities industry and investor 

protection. 

The Dodd-Frank Reform and Consumer Protection Act (Dodd-Frank Act) imposed significant new 

responsibilities on the OIG. In particular, Section 966 required the OIG to establish an OIG SEC 

Employee Suggestion Hotline to receive suggestions by SEC employees for improvements in the work 

efficiency, effectiveness, and productivity, and the use of agency resources, as well as allegations of 

waste, abuse, misconduct, or mismanagement within the SEC. During FY 2012, OIG will continue to 

monitor, track, and analyze information received through the hotline. 

The FY 2012 budget request is being submitted in conformance with the requirements of the Inspector 

General Reform Act of 2008 (P.L. 110-409). The aggregate amount of funds requested for the direct 

costs of operating the OIG in FY 2012 is $5,055,638. The estimated training costs for OIG for

FY 2012 are $22,000, and OIG’s estimated contribution to the Council of the Inspectors General on 

Integrity and Efficiency (CIGIE) is $11,975.
- 71 -

Appendix A-Acronyms

ARP Automation Review Program

ABS Asset-Backed Securities

AML/CFT Anti-Money Laundering - Combating the Financing of Terrorism

ATS Alternative Trading Systems

BD Broker Dealer

CCO Chief Compliance Officers 

CDS Credit Default Swap

CF Division of Corporation Finance 

CIGIE Council of the Inspectors General on Integrity and Efficiency 

CR Continuing Resolution

D&I Diversity & Inclusion

ECN Electronic Communications Network 

EDGAR Electronic Data Gathering, Analysis and Retrieval System

EEO Equal Employment Opportunity 

EIS Electronic Information Systems

EMMA Electronic Municipal Market Access

ENF Division of Enforcement

ESCs Employees’ Securities Companies

ETF Exchange-traded Fund 

FASB Financial Accounting Standards Board 

FDIC Federal Deposit Insurance Corporation

FINRA Financial Industry Regulatory Authority 

FOIA Freedom of Information Act 

FSB Financial Stability Board 

FSOC Financial Stability Oversight Council

FTE Full-Time Equivalent 

FY Fiscal Year

G-20 Group of 20 

GAAP U.S. Generally Accepted Accounting Principles 

GAO Government Accountability Office 

IA Investment Adviser

IAPD Investment Adviser Public Disclosure

IASB International Accounting Standards Board 

IASCF International Accounting Standards Committee Foundation

IC/IA Investment Company/Investment Adviser

IFRS International Financial Reporting Standards 

IG Inspector General

IM Division of Investment Management 

IMF International Monetary Fund

IOSCO International Organization of Securities Commissions 

IPO Initial Public Offering
- 72 -

IT Information Technology

IWMS Integrated Workplace Management System

MMOU Multilateral Memorandum of Understanding 

MOU Memorandum of Understanding 

MSD Municipal Securities Dealer

MSRB Municipal Securities Rulemaking Board 

MUI Matters Under Inquiry

NRSRO Nationally Recognized Statistical Rating Organization 

NTEU National Treasury Employees Union 

OALJ Office of Administrative Law Judges 

OAS Office of Administrative Services 

OCA Office of the Chief Accountant 

OCC Office of the Comptroller of the Currency

OCIE Office of Compliance Inspections and Examinations 

OCOO Office of the Chief Operating Officer

OCR Office of Credit Ratings

OED Office of the Executive Director 

OFM Office of Financial Management 

OFRMS Office of Freedom of Information Act and Records Management Services

OGC Office of the General Counsel 

OHR Office of Human Resources 

OIA Office of International Affairs 

OID Office of Interactive Disclosure

OIEA Office of Investor Education and Advocacy 

OIG Office of the Inspector General 

OIT Office of Information Technology 

OLIA Office of Legislative and Intergovernmental Affairs 

OMB Office of Management and Budget 

OME Office of Managing Executive

OMI Office of Market Intelligence

OMS Office of Municipal Securities

OMWI Office of Minority and Women Inclusion

OPA Office of Public Affairs 

OPM Office of Personnel Management

ORM Operational Risk Management

OS Office of the Secretary 

OTC Over-the-Counter 

PA Privacy Act

PCAOB Public Company Accounting Oversight Board 

PL Public Law

PWG President’s Working Group on Financial Markets

RMS Records Management Services

RSFI Division of Risk, Strategy and Financial Innovation 

SDRs Security-Based Swap Data Repositories
- 73 -

SEFs Security-Based Swap Execution Facilities

SIPC Securities Investor Protection Corporation 

SRO Self-Regulatory Organization 

SRTS SRO Rule Tracking System

SSP Shared Service Provider

TARP Troubled Asset Relief Program 

TCR Tips Complaints and Referrals

TM Division of Trading and Markets 

UIT Unit Investment Trust

VaR Value-At-Risk

XBRL eXtensible Business Reporting Language