U.S. SECURITIES AND EXCHANGE COMMISSION

Summary of Performance

and financial information

F i s c a l Y e a r 2 0 1 5
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The Securities and Exchange Commission at a Glance

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

Introduction: The U.S. Securities and Exchange 

Commission (SEC) publishes a Summary of 

Performance and Financial Information (SPFI), which 

is a brief overview of financial and performance 

information. The SPFI is electronically available at 

www.sec.gov/about/secreports.shtml. The SEC 

also produces the Agency Financial Report (AFR), 

which has a primary focus on financial results, and 

an Annual Performance Report (APR), which focuses 

on strategic goals and performance results. The 

APR is expected to be available in February 2016 

at www.sec.gov/about/secreports.shtml. The AFR is 

electronically available at http://www.sec.gov/about/

secafr2015.shtml. To comment on the AFR or SPFI, 

email SECAFR@sec.gov.

Mission

The mission of the SEC is to protect investors, 

maintain fair, orderly, and efficient markets, 

and facilitate capital formation.

Vision

The SEC strives to promote a market environment that is 

worthy of the public’s trust and characterized by:

• Transparent disclosure to investors of 

the risks of particular investments;

• Oversight of key market participants, including 

exchanges, brokers and dealers, investment 

advisers, and others;

• Focus on strengthening market structure 

and systems;

• Promotion of disclosure of market-related 

information;

• Protection against fraud and abuse; and

• Evaluation, development, and maintenance 

of appropriate rules and regulations.

Values

Integrity Excellence Accountability

Effectiveness Teamwork Fairness

About the SEC 

The SEC is an independent Federal agency established 

pursuant to the Securities Exchange Act of 1934. The SEC 

consists of five presidentially appointed Commissioners, with 

staggered five-year terms. One of them is designated by 

the President as Chair of the Commission. By law, no more 

than three of the Commissioners may belong to the same 

political party. 

The SEC is responsible for overseeing the nation’s securities 

markets and certain primary participants, including brokerdealers, investment companies, investment advisers, clearing 

agencies, transfer agents, credit rating agencies, and securities 

exchanges, as well as organizations such as the Financial 

Industry Regulatory Authority, Municipal Securities Rulemaking 

Board, and Public Company Accounting Oversight Board. 

The SEC also seeks to restore investor confidence in our 

capital markets by providing investors and the markets with 

more reliable information and clear rules of honest dealing. 

Under the Dodd-Frank Wall Street Reform and Consumer 

Protection Act (Dodd-Frank Act), the agency’s jurisdiction 

was expanded to include certain participants in the derivatives 

markets, private fund advisers, and municipal advisors, among 

other changes. 

The agency’s functional responsibilities are organized into 

five divisions and 23 offices, each of which is headquartered 

in Washington, DC. The SEC also has 11 regional offices, 

which are comprised primarily of staff from the national 

enforcement and examination programs. The agency employs 

over 4,300 people.
Fiscal Year 2015 in Review

Fiscal Year (FY) 2015 marked another strong year of 

achievement for the SEC under the leadership of Chair 

Mary Jo White. The SEC acted to meet the challenges of 

an increasingly complex marketplace through strong and 

effective rulemakings; innovative strategies for vigorous 

enforcement; enhanced examinations and oversight; furthering 

its mission through sound economic analysis, enhanced 

investor education, and expanded international cooperation; 

and making the agency’s workforce and technology more 

dynamic and efficient.

Transformative Policy Initiatives for Safer, 

Stronger Markets

• The Commission advanced critical reforms to protect 

investors and build stronger markets, including addressing 

products and practices that contributed directly to the 

financial crisis. These reforms combined strong efforts to 

complete the agency’s mandatory rulemaking obligations 

with new programs to enhance equity market structure, 

the management of risks in the asset management industry, 

and the effectiveness of disclosure.

• The Commission has now completed all of its mandatory 

rulemaking in six of the eight most significant areas targeted 

for SEC action by the Dodd-Frank Act: the regulation of 

private fund advisers; restrictions on proprietary trading; 

enhanced standards for clearing agencies; a new regulatory 

framework for municipal advisors; better regulation of credit 

rating agencies and credit ratings; and credit risk retention 

and improved disclosures for asset-backed securities. 

• The SEC also made significant advances in completing final 

rules for the remaining two areas of mandatory rulemaking 

under the Dodd-Frank Act: security-based swaps and 

executive compensation. With all of the security-based 

swap rules proposed, the Commission finalized rules for 

the regulation of trade reporting and dissemination for security-based swaps, as well as a comprehensive framework 

for registering security-based swap dealers. The Commission also completed its proposals for all of the executive 

Chair Mary Jo White

compensation requirements and began the final rule stage 

with the approval of rules on pay ratio disclosures. 

• With the adoption of final rules for smaller offerings under 

Regulation A, the Commission neared completion of the 

transformative, mandated rulemakings under the Jumpstart 

Our Business Startups (JOBS) Act.1

• Beginning a new phase of rulemaking to enhance the U.S. 

equity market structure, the Commission adopted Regulation Systems Compliance and Integrity, which mandates 

comprehensive new controls to strengthen key technological systems, promoting greater transparency, resiliency, 

and accountability. The Commission also proposed rules 

to enhance regulatory oversight of active proprietary 

trading firms.

• The Commission also initiated a broad-based program of 

regulation for the modern asset management industry and 

the risks it faces. In May 2015, the Commission proposed 

rules to modernize and enhance the information reported 

1 Final rules for crowdfunding were adopted in October 2015 thus completing all of the major JOBS Act mandates.

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

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by investment companies and investment advisers. And 

in September 2015, the Commission proposed reforms 

to promote effective liquidity risk management throughout 

the open-end fund industry.2

• The Commission also actively engaged on the staff’s 

ongoing work to review the effectiveness of securities 

disclosures, with the agency issuing a request for comment 

on certain requirements in Regulation S-X.

Aggressive and Innovative Approach 

to Enforcement

• The SEC ended the year with 807 enforcement actions in 

FY 2015 and obtained orders for $4.2 billion in penalties 

and disgorgement, both record highs. Of the 807 enforcement actions, a record 507 were independent actions for 

securities law violations.

• The Division of Enforcement’s (Enforcement) extremely 

strong fiscal year was due in no small part to the use of 

innovative analytical tools to leverage data to detect and 

investigate complex and intricate violations of the Federal 

securities laws. 

• The SEC continued to blaze new trails in enforcement 

of the Federal securities laws by bringing many first-oftheir-kind cases. These cases involved essential areas, 

including gatekeepers, whistleblower protection, private 

equity, market structure, municipal bonds, securities-based 

swaps, dark pool disclosure, and credit ratings agencies.

• During FY 2015, Enforcement continued to prioritize market 

structure issues, bringing a number of significant actions 

involving alternative trading systems, stock exchanges and 

other market participants to help ensure that our markets 

continue to operate fairly and efficiently. 

• The SEC charged 87 parties with insider trading actions, 

which sends a strong message of deterrence to would-be 

violators. Comprehensive, accurate, and reliable financial 

reporting is the bedrock upon which the markets are based. 

Rooting out financial and disclosure fraud continued to 

be an Enforcement priority in FY 2015. During FY 2015, 

Enforcement also remained focused on potential violations 

by gatekeepers. Gatekeepers are integral to protecting 

investors in our financial system because they are best 

positioned to detect and prevent the compliance breakdowns 

and fraudulent schemes that cause investor harm. 

• Enforcement broadened its efforts to combat microcap 

fraud to encompass significant actions involving 

international schemes, professionals associated with 

microcap frauds, and recidivist offenders.

• Enforcement brought actions against a wide range of 

investment advisers, including those who failed to disclose 

conflicts of interest, engaged in fraudulent conduct, and 

otherwise breached their fiduciary duties to their clients.

• The SEC brought a number of actions involving complex 

financial instruments, which built on the SEC’s already 

strong record of pursuing financial crisis-related cases.

• In coordination with the SEC’s Office of International Affairs 

(OIA), Enforcement continued to expand its international 

enforcement efforts. FY 2015 included several significant 

actions involving cooperation with the SEC’s law 

enforcement and regulatory counterparts both at home 

and abroad.

Commissioner Luis A. Aguilar

2 A new rule designed to enhance the regulation of the use of derivatives by registered investment companies was proposed in 

December 2015.

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

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Continued Excellence in the 

Examination Program

• The Office of Compliance Inspections and Examinations 

(OCIE) conducted nearly 2,000 formal examinations of 

registrants, including broker-dealers, investment advisers, 

investment companies, national securities exchanges, 

self-regulatory organizations, transfer agents, and clearing 

agencies, marking an increase over each of the prior five 

fiscal years. OCIE’s examinations resulted in the return 

of approximately $120 million to investors. 

• When OCIE uncovers information in an examination that 

establishes or suggests misconduct, examiners refer the 

matter to Enforcement for investigation and appropriate 

action. In FY 2015, OCIE made more than 200 referrals, 

many of which resulted in enforcement investigations 

and/or actions.

• OCIE also continued to make significant enhancements in 

data analytics. This effort has made OCIE more efficient 

and effective in analyzing massive amounts of data from 

registrants to detect potential violations of laws, rules, 

and regulations.

Protecting Investors and Markets through 

Analysis, Education, and Cooperation 

• The Division of Economic and Risk Analysis (DERA) 

continued to expand its functions, serving as a hub for the 

Commission’s intake, processing, and use of data. DERA’s 

staff economists, analysts, database administrators and 

other technologists serve as experts on how to analyze the 

economics of an issue and deploy these data for analytical 

purposes across the rulemaking, enforcement, and other 

functions of the Commission.

• FY 2015 was also marked by a continued and intensified 

commitment to providing investors with the information 

they need to avoid securities fraud and make informed 

investment decisions. The SEC’s Office of Investor 

Education and Advocacy continued to enhance its support 

of the Commission’s investor protection mission, including 

handling investment-related complaints and questions from 

tens of thousands of individual investors. 

Commissioner Daniel M. Gallagher

• Working in close collaboration with divisions and offices 

across the agency, OIA continued to facilitate the 

enforcement and regulation of activities in today’s global 

securities markets, where the SEC has many internationally 

active registrants and where the U.S. market is impacted 

by cross-border transactions and developments in other 

markets. In FY 2015, OIA handled approximately 135 

supervisory cooperation requests to foreign authorities 

and 113 responses to supervisory cooperation requests 

from foreign authorities. 

Continuing to Enhance Operations

• The Chief Operating Officer continued to provide strategic 

leadership and oversight of the SEC human, financial, 

technological, and administrative resources focused on 

infrastructure and operational activities that enabled the 

agency to accomplish its tripartite mission. 

• The collaborative interaction of the Office of Information 

Technology (OIT), Office of Human Resources (OHR), Office 

of Financial Management, Office of Acquisitions, Office 

of Support Operations, and Office of the Chief Operating 

Officer (OCOO) continued to support these interdependent 

efforts, allowing for flexible, efficient, and cost-effective 

actions by the agency regardless of the challenges at hand.

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

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Fiscal Year 2015 Performance Highlights

Strategic Goals and Costs

The SEC’s performance data provides a foundation for both 

programmatic and organizational decision-making and is critical 

for gauging the agency’s success in meeting its objectives. The 

SEC is committed to using performance management best 

practices to promote greater accountability. 

The SEC’s FY 2015 APR will be issued with the agency’s 

FY 2017 Congressional Budget Justification, and will provide 

a complete discussion of all of the agency’s strategic goals, 

including a description of performance goals and objectives, 

data sources, performance results and trends, and information 

about internal reviews and evaluations. The APR also includes 

a summary of the SEC’s verification and validation process for 

all performance data.

Provided below are the SEC’s strategic goals and objectives, 

and a summary of the agency’s FY 2015 results for its key 

performance goals.

Strategic Goal 1: Establish and maintain an effective 

regulatory environment 

• Strategic Objective 1.1: The SEC establishes and 

maintains a regulatory environment that promotes highquality disclosure, financial reporting and governance, and 

that prevents abusive practices by registrants, financial 

intermediaries and other market participants. 

• Strategic Objective 1.2: The SEC promotes capital 

markets that operate in a fair, efficient, transparent and 

competitive manner, fostering capital formation and useful 

innovation.

• Strategic Objective 1.3: The SEC adopts and 

administers regulations and rules that are informed by 

robust economic analysis and public comment and that 

enable market participants to understand clearly their 

obligations under the securities laws.

• Strategic Objective 1.4: The SEC engages with 

a multitude of stakeholders to inform and enhance 

regulatory activities domestically and internationally.

Strategic Goal 2: Foster and enforce compliance with 

the Federal securities laws 

• Strategic Objective 2.1: The SEC fosters compliance 

with the Federal securities laws. 

• Strategic Objective 2.2: The SEC promptly detects and 

deters violations of the Federal securities laws.

• Strategic Objective 2.3: The SEC prosecutes violations 

of Federal securities laws and holds violators accountable 

through appropriate sanctions and remedies.

Strategic Goal 3: Facilitate access to the information 

investors need to make informed investment decisions 

• Strategic Objective 3.1: The SEC works to ensure that 

investors have access to high-quality disclosure materials 

that facilitate informed investment decision-making. 

• Strategic Objective 3.2: The SEC works to understand 

investor needs and educate investors so they are better 

prepared to make informed investment decisions.

Strategic Goal 4: Enhance the Commission’s performance through effective alignment and management 

of human, information, and financial capital 

• Strategic Objective 4.1: The SEC promotes a resultsoriented work environment that attracts, engages, and 

retains a technically proficient and diverse workforce, 

including leaders who provide motivation and strategic 

direction.

• Strategic Objective 4.2: The SEC encourages a 

collaborative environment across divisions and offices 

and leverages technology and data to fulfill its mission 

more effectively and efficiently.

• Strategic Objective 4.3: The SEC maximizes the use 

of agency resources by continually improving agency 

operations and bolstering internal controls. 

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

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Key Performance Achievements 

As part of the SEC’s efforts to promptly detect and deter violations of the Federal securities laws (Strategic Objective 2.2), the 

agency’s National Examination Program (NEP) conducts inspections of regulated entities, covering as much of the securities 

industry as resources will allow. Overall, the program exceeded expectations and completed more examinations than in any 

of the previous five fiscal years (Performance Goal 2.2.1). 

PERFORMANCE GOAL 2.2.1

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

Description: This metric indicates the number of registrants examined by the SEC or a Self-Regulatory Organization (SRO) as a percentage of

the total number of registrants. This metric includes all types of examinations: risk priority 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 2010 FY 2011 FY 2012 FY 2013 FY 2014

FY 2015 

Plan

FY 2015 

Actual

FY 2015 

Results

Investment advisers 9% 8% 8% 9% 10% 10% 10% Met

Investment companies 10% 13% 12% 11% 10% 12% 15% Exceeded

Broker-dealers (exams by SEC and SROs) 44% 58% 49% 46% 49% 50% 51% Exceeded

Responsible Division/Office: Office of Compliance Inspections and Examinations

Data Source: Tracking and Reporting Exam National Documentation System (TRENDS), (IA, IC, and BD SEC data) and SRO Databases (BD SRO Data)

Prosecuting violations of Federal securities laws and holding violators accountable (Strategic Objective 2.3) are among the most 

important aspects of the Commission’s work. The SEC has implemented controls and strategies to resolve actions quickly 

and on a favorable basis, while at the same time, it does not hesitate to file matters on a contested basis where a favorable 

settlement was unavailable before filing (Performance Goal 2.3.1). The SEC has dedicated the necessary resources to ensure 

that the agency will continue to have a strong record of success. 

Description: This metric identifies, as to all parties to enforcement actions that were resolved in the fiscal year, the percentage against whom the 

Commission obtained a judgment or order entered on consent, a default judgment, a judgment of liability on one or more charges, and/or the 

imposition of monetary or other relief.

PERFORMANCE GOAL 2.3.1

Percentage of enforcement actions in which the Commission obtained relief on one or more claims

FY 2015 FY 2015 FY 2015 

Fiscal Year FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 Plan Actual Results

Percentage 92% 93% 89% 93% 94% 92% 95% Exceeded

Responsible Division/Office: Division of Enforcement

Data Source: HUB case management and tracking system for the Division of Enforcement

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

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An educated investing public ultimately provides the best defense against fraud and costly mistakes. The starting point for shaping 

company disclosure is remembering its purpose, which is, that investors have access to high-quality disclosure materials that 

facilitate informed investment decision-making (Strategic Objective 3.1). Consistent with Section 408 of the Sarbanes Oxley-Act 

of 2002, the SEC completed its review of disclosures made by certain public issuers, including issuers’ financial statements, 

no less frequently than once every three years (Performance Goal 3.1.1).

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

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PERFORMANCE GOAL 3.1.1

Percentage of public companies and investment companies with disclosures reviewed each year

Description: The Sarbanes-Oxley Act requires that the SEC review, at least once every three years, the disclosures of all companies and investment 

company portfolios reporting under the Exchange Act. These reviews help improve the information available to investors and may identify possible 

violations of the Federal securities laws. This metric gauges the number of public companies and investment companies reviewed each year.

FY 2015 FY 2015 FY 2015 

Fiscal Year FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 Plan Actual Results

Division of Corporation Finance

Corporations 44% 48% 48% 52% 52% 33% 51% Exceeded

Responsible Division/Office: Division of Corporation Finance

Data Source: Electronic, Data Gathering, Analysis, and Retrieval (EDGAR)/Filing Activity Tracking System (FACTS)

Division of Investment Management

Investment company portfolios 35% 33% 36% 34% 35% 33% 35% Exceeded

Responsible Division/Office: Division of Investment Management

Data Source: Microsoft Office Suite Tools

Understanding the interests and concerns of investors is critical to carrying out the Commission’s investor protection mission. 

The SEC advances this mission by seeking to understand investor needs and educate investors so they are better prepared to 

make informed investment decisions (Strategic Objective 3.2). The SEC had 23.6 million page views of online investor education 

content and participated in 71 in-person events (Performance Goal 3.2.1). 

PERFORMANCE GOAL 3.2.1

Number of page views of online investor education content, and number of in-person events, 

including those with specifically targeted communities and organizations

Description: The Office of Investor Education and Advocacy (OIEA) initiates investor education campaigns on key strategies for making informed 

investment decisions, including publicizing online resources for researching investment professionals and investments, understanding fees, and 

identifying fraud. OIEA staff also participates in in-person events for investors generally and those targeted to specific investors, such as seniors, 

service members, and other affinity groups. This metric tracks page views of SEC online investor education materials and the number of investor 

events in which OIEA staff participated.

FY 2015 FY 2015 FY 2015 

Fiscal Year FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 Plan Actual Results

Number of page views (in millions) Prior-year data not available 12.1 22.2 20 23.6 Exceeded

Number of “in-person” events Prior-year data not available 52 51 50 71 Exceeded

Responsible Division/Office: Office of Investor Education and Advocacy

Data Source: Google Analytics, Microsoft Office Suite Tools
Management Assurances

In FY 2015, the SEC demonstrated its continued commitment 

to maintaining strong internal controls. Internal control is an 

integral component of effective agency management, providing 

reasonable assurance that the following objectives are being 

achieved: effectiveness and efficiency of operations, reliability of 

financial reporting, and compliance with laws and regulations.

Assurance Statement On Internal Control Over Operations: The SEC management is responsible for establishing and maintaining effective internal control that meets the 

objectives of the Federal Managers’ Financial Integrity Act of 

1982 (FMFIA). In accordance with Office of Management and 

Budget (OMB) Circular A-123, the SEC conducted its annual 

assessment of the effectiveness of internal controls. Based on 

the results of the assessment for the period ending September 

30, 2015, the SEC is able to provide a statement of assurance 

that the internal controls, both for the agency as a whole and 

for the Investor Protection Fund, meet the objectives of the 

FMFIA. No material weaknesses were found in the design 

or operation of the internal controls for the fiscal year ended 

September 30, 2015. 

Assurance Statement On Internal Control Over Financial Reporting (ICFR): In accordance with Appendix A of 

OMB Circular A-123, the SEC conducted its assessment of 

the effectiveness of internal control over financial reporting, 

which includes safeguarding of assets and compliance with 

applicable laws and regulations. Based on the results of the 

assessment, the SEC is able to provide reasonable assurance 

that internal controls over financial reporting, both for the 

agency as a whole and for the SEC’s Investor Protection Fund, 

met the objectives of FMFIA and were operating effectively 

as of September 30, 2015. No material weaknesses were 

found in the design or operation of controls.

SEC also conducted reviews of its financial management 

systems in accordance with OMB Circular A-123 Appendix 

D, Compliance with the Federal Financial Management 

Improvement Act of 1996 (FFMIA). Based on the results of 

these reviews, SEC can provide reasonable assurance that 

its financial management systems substantially comply with 

the requirements of the FFMIA as of September 30, 2015.

Summary of Financial Statement Audit

Audit Opinion: Unmodified

Restatement: No

INDEPENDENT AUDITOR’S INTERNAL CONTROL FINDINGS

Category FY 2015 Audit Finding

Material Weaknesses None

Significant Deficiencies None

Category FY 2014 Audit Finding

Material Weaknesses None

Significant Deficiency Accounting for Disgorgement 

and Penalties 

For FY 2015, the SEC’s independent auditor, the U.S. 

Government Accountability Office (GAO), has issued an 

unmodified opinion (clean opinion) on our financial statements 

and internal controls. The SEC also successfully downgraded 

the significant deficiency identified in FY 2014 related to 

accounting for disgorgement and penalties. The SEC has 

worked diligently to address GAO’s recommendations in this 

highly complex area. For example, the SEC reevaluated its 

business processes and bolstered controls related to the 

timely recording of court judgments impacting the financial 

statements. The SEC has also developed the requirements 

for a new disgorgement and penalty sub-ledger system and 

expects the effort to implement the system to commence in FY 

2016. This system is aimed towards streamlining the controls 

in this key area by providing more comprehensive information 

in a more automated fashion.

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

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Looking Forward Fiscal Year 2016

In FY 2016, the SEC will continue to promote policies and 

programs to protect investors, maintain fair, orderly, and 

efficient markets, and facilitate capital formation. The SEC 

will continue to make progress on important rulemakings – 

both those mandated by Congress and those initiated by 

the SEC to enhance our program in mission-critical areas. 

In FY 2016, the SEC will aim to: 

• Finish implementation of a regulatory regime for securitybased swaps;

• Complete final rules related to executive compensation

required by the Dodd-Frank Act, including requirements

relating to “pay versus performance,” disclosures of

employee and director hedging, and compensation

clawbacks;

• Develop revised rules to require reporting issuers engaged

in the commercial development of oil, natural gas, or

minerals to disclose in an annual report certain payments

made to the United States or a foreign government;

• Advance the remaining rules, studies, and reports required

by the Dodd-Frank Act, JOBS Act, and Fixing America’s

Surface Transportation Act;

• Continue to pursue enhanced regulations for equity

market structure and asset managers, as well as further

develop potential changes to improve the effectiveness

of securities disclosures; and

• Continue to advance a potential proposal for a uniform

standard of conduct for broker dealers and investment

advisers, as well as third party reviews of certain adviser

activities.

The SEC will also continue to enhance its robust enforcement 

and examination programs using innovative data analysis 

and cutting-edge technology.

• Enforcement and OCIE will continue to build on their very

strong results from FY 2015 by focusing on current and

emerging high-priority areas, and on leveraging cuttingedge technology and analytics.

• Enforcement’s priorities for the coming year include a

continued focus on data to target and streamline their

efforts, complex financial products, gatekeepers, financial

reporting, market structure, insider trading, investment

advisers and private funds, and municipal securities.

From left to right: Commissioner Kara M. Stein, Commissioner Luis A. Aguilar, Chair Mary Jo White, Commissioner Daniel M. Gallagher, 

and Commissioner Michael S. Piwowar

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Commissioner Michael S. Piwowar

• OCIE will continue to use data analytics that enable 

preemptive detection of risk throughout entire industries and 

more effective identification of fraud during examinations. 

OCOO will continue to strengthen the human, financial, and 

technical infrastructure that allows the agency to effectively 

advance its mission in a dynamic and cost-effective manner.

• OHR will focus on identifying and recruiting an increasingly 

talented and diverse team; elevating individuals’ 

performance and retention through personalized 

development strategies; providing targeted training and 

education opportunities; and offering effective career 

guidance and support, including leadership training for 

potential senior managers and executives.

• The SEC will continue a review of administrative 

processes across the agency. The analysis will identify and 

assess the current state of administrative requirements 

within the agency to identify process improvements, 

implement a governance structure, develop tools and 

technologies, and clarify roles and responsibilities for the 

SEC administrative community.

• OIT will continue its leadership role in the overall 

management for the SEC’s information technology (IT) 

program including application development, infrastructure 

operations and engineering, user support, IT program 

management, capital planning, security, and enterprise 

architecture.

In FY 2015, the SEC continued to achieve important results by 

leveraging technology; employing sophisticated data analytics; 

and pursuing focused rulemaking and policy initiatives, aggressive enforcement, and risk-based examinations. Through the 

work of its talented and dedicated staff, the SEC is committed to 

building on its successes in FY 2016. The agency will continue 

to promote its strategic values of integrity, accountability, effectiveness, teamwork, fairness and a commitment to excellence, 

through enhancing collaboration and coordination among its 

divisions and offices, employing new technology, and supporting the more than 4,000 talented men and women who work 

tirelessly to fulfill the agency’s important mission.

Commissioner Kara M. Stein

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FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

Inspector General’s Statement on Management 

and Performance Challenges

The Reports Consolidation Act of 2000 requires the U.S. 

Securities and Exchange Commission (SEC or agency) Office 

of Inspector General (OIG) to identify and report annually on 

the most serious management challenges that the SEC faces.

A summary of the FY 2015 management challenges as noted in 

The Inspector General’s Statement on the SEC’s Management 

and Performance Challenges, September 2015 are: 

• Regulatory Oversight: As a regulatory agency, the

SEC must be able to keep pace with changes in the size

and complexity of the securities markets and the market

participants the SEC oversees and regulates. In 2014,

the OIG reported that the SEC (specifically, the SEC

Chair and the Investor Advocate) had identified resource

constraints and an immediate and pressing need for

ensuring sufficient examination coverage of registered

investment advisers as a challenge and a “substantial and

continuing risk to investors.”1 The SEC also continues to

recognize needed technological improvements to achieve

its mission.

• Information Security: To accomplish the SEC’s mission,

the agency shares sensitive information internally among

its divisions and offices and externally with the regulated

community and financial regulators. During FY 2015,

we identified and assessed weaknesses in the agency’s

controls over information security.

• Acquisition Management: The SEC has made progress

in improving its acquisitions policies and procedures;

however, the OIG continues to find improvements the

SEC can make in the area of contract management.

• Financial Management: During GAO’s FY 2014 audit,

GAO identified continuing and new deficiencies in the

SEC’s internal controls over disgorgement and penalty

transactions that constituted a significant deficiency in the

SEC’s internal control over financial reporting.2 In addition

to this significant deficiency, in April 2015, GAO reported

other new deficiencies in the SEC’s internal control over

financial reporting. While not considered to be material

weaknesses or significant deficiencies, either individually

or collectively, according to GAO these deficiencies

warrant SEC management’s attention. The OIG will

continue to monitor the SEC’s financial management

and reporting controls and actions to address open

recommendations.

• Human Capital Management: Human capital

management remains a challenge. The agency further

reported that additional steps were being taken in FY 2015

to finalize SEC-wide strategic initiatives and incorporate

all elements of effective workforce planning into the

overall plan, to be completed by the end of FY 2015.

However, as of September 30, 2015, the SEC did not

expect to complete the comprehensive workforce plan

until Spring 2016.

Management’s Response to the Inspector General’s 

Statement: The SEC remains committed to enhancing 

the financial and operational effectiveness of the agency 

and appreciates the OIG’s role in the effort. The SEC has 

actions—taken and planned to be taken—to address each 

of the challenges identified in the OIG statement.

1 U.S. Securities and Exchange Commission, Office of the Investor Advocate, Report on Objectives Fiscal Year 2015. 

2 This significant deficiency pertained to the SEC’s overall financial reporting but not that of the Investor Protection Fund because the 

Investor Protection Fund does not include disgorgement and penalty transactions. 
Fiscal Year 2015 Financial Highlights

SELECTED FINANCIAL DATA FOR FY 2015 AND FY 2014

(DOLLARS IN MILLIONS) FY 2015 FY 2014

Total Assets $ 11,456 $ 10,591

Total Liabilities $ 3,773 $ 2,900

Net Position $ 7,683 $ 7,691

Annual Net Position Change 0% 0%

Total Program Costs $ 1,584 $ 1,441

Revenues $ 2,070 $ 1,906

Net (Income) Cost from Operations $ (486) $ (465)

Total Budgetary Resources $ 1,713 $ 1,551

Actual FTEs 4,301 4,150

Sequestration Order for FY 2015

On March 1, 2013, the President issued the Sequestration 

Order for FY 2013 which reduced FY 2013 budget authority. 

As determined by OMB, for FY 2015, the sequestration order 

was applicable to mandatory appropriations, which included 

the Reserve Fund.

For example, in FY 2015 the budget authority of $75 million 

was reduced by 7.3 percent or $5 million.

Reserve Fund

Section 991(e) of the Dodd-Frank Act authorized the creation 

of a Securities and Exchange Commission Reserve Fund 

(Reserve Fund). Funded from filing fee collections, the SEC 

can deposit up to $50 million per fiscal year, and the fund 

cannot hold more than $100 million in total. Excess filing fees 

are deposited to the U.S. Treasury General Fund.

For the period ended September 30, 2015, filing fee revenues 

were $581 million. Fifty million dollars was deposited into the 

Reserve Fund, of which $5 million was sequestered. The 

excess of $531 million was earned on behalf of the U.S. 

Treasury General Fund.

Filing fees deposited to the Reserve Fund can be used to fund 

the SEC’s operations, create budgetary authority, and are 

reported as a component of Appropriations (Discretionary and 

Mandatory) on the SEC’s Statement of Budgetary Resources. 

Filing fees deposited in the U.S. Treasury General Fund cannot 

be used to fund the SEC’s operations. These amounts do not 

create budgetary authority, and are reported as a component 

of Other Financing Sources: Other on the SEC’s Statement 

of Changes in Net Position.

FY 2015 SOURCES OF FUNDS

Recoveries of

Prior Year Unpaid

Obligations

2%

Unobligated Balance, Brought

Forward, October 1 – Without

Unfunded Lease Obligations

23%

Appropriations

Spending Authority

from Offsetting 3%

Collections

72%

Percentages do not include the Unobligated Balance Brought Forward, 

October 1 – Interpretation for Lease Obligations.

CHART 1.8

FY 2015 ASSETS BY TYPE

Investments – 

Disgorgement and 

Penalties Fund

22%

Fund Balance 

with Treasury

66%

Investments – Investor 

Protection Fund

3%

Accounts 8%Receivable, Net

Property and 

Other Assets

1%

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

PAGE

13
FY 2015 LIABILITIES BY TYPE

Custodial Liability

13%

Liability for 

Disgorgement 

and Penalties

80%

Accrued Payroll, 

Benefits and Leave

4%

Accounts 1%Payable

Other Liabilities

1%

Registrant 1%Deposits

FY 2015 Program Costs 

Total Program Costs were $1.6 billion for the period ended 

September 30, 2015, an increase of $143 million, or 10 percent, 

compared to FY 2014. Salary and Benefit Expenses increased 

more than $79 million, as the result of increased staffing and 

compensation. Other Expenses increased more than $64 million, 

which includes $3 million in accrued expenses for whistleblower 

payments from the SEC’s Investor Protection Fund, and 

$49 million in additional expenses for contractual services.

FY 2015 PROGRAM COSTS

Other Program 4%

Compliance

Inspections and

Examinations

21%

Agency Direction and 13%Administrative Support

Inspector 1%General

Enforcement

35%

Offices

General 3%Counsel

Economic

Risk and

Analysis

4%

Investment

Management

4%

Trading and

Markets

5%

Corporation Finance

10%

The SEC had increased expenses in the areas of personnel 

compensation and benefits, which correlates to the increase 

in full-time equivalent employees; information technology 

service contracts and licensing; capitalized and noncapitalized 

information systems software and hardware; and whistleblower 

award payments.

Investor Protection Fund

The SEC prepares standalone financial statements for the 

Investor Protection Fund as required by the Dodd-Frank Act. The 

Investor Protection Fund was established in FY 2010 to provide 

funding for a whistleblower award program and to finance 

the operations of the OIG’s Employee Suggestion Program. 

Sanctions collected by the Commission payable either to the 

SEC or the U.S. Treasury General Fund will be transferred to 

the Investor Protection Fund if the balance in that fund is less 

than $300 million on the day of collection.

INVESTOR PROTECTION FUND ACTIVITY

FOR THE YEARS ENDED SEPTEMBER 30, 2015 AND 2014

(DOLLARS IN THOUSANDS) FY 2015 FY 2014

Balance of Fund at beginning of 

fiscal year, October 1 $414,660 $439,197

Amount of earnings on investments 

during the fiscal year 867 579

Amount paid from the Fund during the 

fiscal year to whistleblowers (28,397) (25,069)

Amount paid from the Fund during the 

fiscal year for expenses incurred by 

Employee Suggestion Program (19) (47)

Balance of the Fund at the end of the 

reporting period $ 387,111 $ 414,660

Note: Table is presented as “Dollars in Thousands” in order to detail the Investor 

Protection Fund Activity.

FY 2015 SUMMARY OF PERFORMANCE AND FINANCIAL INFORMATION

PAGE

14
This report and other agency reports are available at www.sec.gov/about/secreports.shtml. 


Please send your comments to SECAFR@sec.gov.
 

Issued February 11, 2016
 
U.S. SECURITIES AND EXCHANGE COMMISSION

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