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[Federal Register Volume 90, Number 14 (Thursday, January 23, 2025)]
[Notices]
[Page 8087]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-01614]

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SECURITIES AND EXCHANGE COMMISSION

[Securities Act of 1933 Release No. 11360/January 17, 2025; Securities 
Exchange Act of 1934 Release No. 102235/January 17, 2025]

Order Regarding Review of Financial Accounting Standards Board 
(``FASB'') Accounting Support Fee for 2025 Under Section 109 of the 
Sarbanes-Oxley Act of 2002

    The Sarbanes-Oxley Act of 2002 (``SOX'' or the ``Act'') provides 
that the Securities and Exchange Commission (the ``Commission'') may 
recognize, as generally accepted for purposes of the securities laws, 
any accounting principles established by a standard-setting body that 
meets certain criteria.\1\ Section 109 of SOX provides that all of the 
budget of such a standard-setting body shall be payable from an annual 
accounting support fee assessed and collected against each issuer, as 
may be necessary or appropriate to pay for the budget and provide for 
the expenses of the standard-setting body, and to provide for an 
independent, stable source of funding, subject to review by the 
Commission. Under Section 109(f) of the Act, the amount of fees 
collected for a fiscal year shall not exceed the ``recoverable budget 
expenses'' of the standard-setting body. Section 109(i) of SOX amends 
Section 13(b)(2) of the Securities Exchange Act of 1934 to require 
issuers to pay the allocable share of a reasonable annual accounting 
support fee or fees, determined in accordance with Section 109 of the 
Act.
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    \1\ See 15 U.S.C. 7201 et seq.
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    On April 25, 2003, the Commission issued a policy statement 
concluding that the Financial Accounting Standards Board and its parent 
organization, the Financial Accounting Foundation (``FAF''), satisfied 
the criteria for an accounting standard-setting body under the Act, and 
recognizing the FASB's financial accounting and reporting standards as 
``generally accepted'' under Section 108 of the Act.\2\ Accordingly, 
the Commission undertook a review of the FASB's accounting support fee 
for calendar year 2025.\3\ In connection with its review, the 
Commission also reviewed the budget for the FAF and the FASB for 
calendar year 2025.
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    \2\ See Commission Statement of Policy Reaffirming the Status of 
the FASB as a Designated Private-Sector Standard Setter, Release No. 
33-8221 (Apr. 25, 2003) [68 FR 23333 (May 1, 2003)].
    \3\ The Financial Accounting Foundation's Board of Trustees 
approved the FASB's budget on Nov. 19, 2024. The FAF submitted the 
approved budget to the Commission on Nov. 22, 2024.
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    Section 109 of SOX provides that, in addition to the accounting 
support fee, the standard-setting body can have additional sources of 
revenue for its activities, such as earnings from sales of 
publications, provided that each additional source of revenue shall not 
jeopardize, in the judgment of the Commission, the actual or perceived 
independence of the standard setter. In this regard, the Commission 
also considered the interrelation of the operating budgets of the FAF, 
the FASB, and the Governmental Accounting Standards Board (``GASB''), 
the FASB's sister organization, which sets accounting standards used by 
state and local government entities. The Commission has been advised by 
the FAF that neither the FAF, the FASB, nor the GASB accept 
contributions from the accounting profession.
    The Commission understands that the Office of Management and Budget 
(``OMB'') has determined the FASB's spending of the 2025 accounting 
support fee is sequestrable under the Budget Control Act of 2011.\4\ So 
long as sequestration is applicable, we anticipate that the FAF will 
work with the Commission and Commission staff as appropriate regarding 
its implementation of sequestration.
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    \4\ See OMB Report to the Congress on the BBEDCA 251A 
Sequestration for Fiscal Year 2025 (Mar. 11, 2024), available at 
https://www.whitehouse.gov/wp-content/uploads/2024/03/BBEDCA_251A_Sequestration_Report_FY2025.pdf.
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    After its review, the Commission determined that the 2025 annual 
accounting support fee for the FASB is consistent with Section 109 of 
the Act. Accordingly,
    It is ordered, pursuant to Section 109 of SOX, that the FASB may 
act in accordance with this determination of the Commission.

    By the Commission.
Sherry R. Haywood,
Assistant Secretary.
[FR Doc. 2025-01614 Filed 1-22-25; 8:45 am]
BILLING CODE 8011-01-P
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