33172 Federal Register / Vol. 61, No. 124 / Wednesday, June 26, 1996 / Notices

yield curve in order to capture the

material effects of any explicit or

embedded options.

Assumptions about customer behavior

and new business activity should be

reasonable and consistent with each rate

scenario that is evaluated. In particular,

as part of its measurement process, bank

management should consider how the

maturity, repricing and cash flows of

instruments with embedded options

may change under various scenarios.

Such instruments would include loans

that can be prepaid without penalty

prior to maturity or have limits on the

coupon adjustments, and deposits with

unspecified maturities or rights of early

withdrawal.

Monitoring and Reporting Exposures

Institutions should also establish an

adequate system for monitoring and

reporting risk exposures. A bank’s

senior management and its board or a

board committee should receive reports

on the bank’s interest rate risk profile at

least quarterly. More frequent reporting

may be appropriate depending on the

bank’s level of risk and the potential

that the level of risk could change

significantly. These reports should

allow senior management and the board

or committee to:

• Evaluate the level and trends of the

bank’s aggregated interest rate risk

exposure.

• Evaluate the sensitivity and

reasonableness of key assumptions—

such as those dealing with changes in

the shape of the yield curve or in the

pace of anticipated loan prepayments or

deposit withdrawals.

• Verify compliance with the board’s

established risk tolerance levels and

limits and identify any policy

exceptions.

• Determine whether the bank holds

sufficient capital for the level of interest

rate risk being taken.

The reports provided to the board and

senior management should be clear,

concise, and timely and provide the

information needed for making

decisions.

Internal Control, Review, and Audit of

the Risk Management Process

A bank’s internal control structure is

critical to the safe and sound

functioning of the organization

generally, and to its interest rate risk

management process in particular.

Establishing and maintaining an

effective system of controls, including

the enforcement of official lines of

authority and the appropriate separation

of duties, are two of management’s more

important responsibilities. Individuals

responsible for evaluating risk

monitoring and control procedures

should be independent of the function

they are assigned to review.

Effective control of the interest rate

risk management process includes

independent review and, where

appropriate, internal and external audit.

The bank should conduct periodic

reviews of its risk management process

to ensure its integrity, accuracy and

reasonableness. Items that should be

reviewed and validated include:

• The adequacy of, and personnel’s

compliance with, the bank’s internal

control system.

• The appropriateness of the bank’s

risk measurement system given the

nature, scope and complexity of its

activities.

• The accuracy and completeness of

the data inputs into the bank’s risk

measurement system.

• The reasonableness and validity of

scenarios used in the risk measurement

system.

• The validity of the risk

measurement calculations. The validity

of the calculations is often tested by

comparing actual versus forecasted

results.

The scope and formality of the review

and validation will depend on the size

and complexity of the bank. At large

banks, internal and external auditors

may have their own models against

which the bank’s model is tested. Banks

with complex risk measurement systems

should have their models or

calculations validated by an

independent source—either an internal

risk control unit of the bank or by

outside auditors or consultants.

The findings of this review should be

reported to the board on an annual

basis. The report should provide a brief

summary of the bank’s interest rate risk

measurement techniques and

management practices. It also should

identify major critical assumptions used

in the risk measurement process,

discuss the process used to derive those

assumptions and provide an assessment

of the impact of those assumptions on

the bank’s measured exposure.

Dated: May 13, 1996.

Eugene A. Ludwig,

Comptroller of the Currency.

By order of the Board of Governors of the

Federal Reserve System.

Dated: May 23, 1996.

William W. Wiles,

Secretary of the Board.

By order of the Board of Directors.

Dated at Washington, DC, this 14th day of

May, 1996.

Robert E. Feldman,

Deputy Executive Secretary.

[FR Doc. 96–16300 Filed 6–25–96; 8:45 am]

BILLING CODES: 4810–33–P; 6210–01–P; 6714–01–P

Internal Revenue Service

Proposed Collection; Comment

Request for Form 8843

AGENCY: Internal Revenue Service (IRS),

Treasury.

ACTION: Notice and request for

comments.

SUMMARY: The Department of the

Treasury, as part of its continuing effort

to reduce paperwork and respondent

burden, invites the general public and

other Federal agencies to take this

opportunity to comment on proposed

and/or continuing information

collections, as required by the

Paperwork Reduction Act of 1995,

Public Law 104–13 (44 U.S.C.

3506(c)(2)(A)).

Currently, the IRS is soliciting

comments concerning Form 8843,

Statement for Exempt Individuals and

Individuals With a Medical Condition.

DATES: Written comments should be

received on or before August 26, 1996,

to be assured of consideration.

ADDRESSES: Direct all written comments

to Garrick R. Shear, Internal Revenue

Service, room 5571, 1111 Constitution

Avenue NW., Washington, DC 20224.

FOR FURTHER INFORMATION CONTACT:

Requests for additional information or

copies of the form(s) and instructions

should be directed to Martha R. Brinson,

(202) 622–3869, Internal Revenue

Service, room 5571, 1111 Constitution

Avenue NW., Washington, DC 20224.

SUPPLEMENTARY INFORMATION:

Title: Statement for Exempt

Individuals and Individuals With a

Medical Condition.

OMB Number: 1545–1411.

Form Number: Form 8843.

Abstract: Form 8843 is used by an

alien individual to explain the basis of

the individual’s claim that he or she is

able to exclude days of presence in the

United States because the individual is

a teacher/trainee or student;

professional athlete; or has a medical

condition or problem.

Current Actions: There are no changes

being made to this form at this time.

Type of Review: Extension of a

currently approved collection.

Affected Public: Individuals or

households.

Estimated Number of Respondents:

150,000.
Federal Register / Vol. 61, No. 124 / Wednesday, June 26, 1996 / Notices 33173

Estimated Time Per Respondent: 1 hr.

9 min.

Estimated Total Annual Burden

Hours: 172,485.

REQUEST FOR COMMENTS: Comments

submitted in response to this notice will

be summarized and/or included in the

request for OMB approval. All

comments will become a matter of

public record. Comments are invited on:

(a) Whether the collection of

information is necessary for the proper

performance of the functions of the

agency, including whether the

information shall have practical utility;

(b) the accuracy of the agency’s estimate

of the burden of the collection of

information; (c) ways to enhance the

quality, utility, and clarity of the

information to be collected; (d) ways to

minimize the burden of the collection of

information on respondents, including

through the use of automated collection

techniques or other forms of information

technology; and (e) estimates of capital

or start-up costs and costs of operation,

maintenance, and purchase of services

to provide information.

Approved: June 14, 1996.

Garrick R. Shear,

IRS Reports Clearance Officer.

[FR Doc. 96–16339 Filed 6–25–96; 8:45 am]

BILLING CODE 4830–01–U

Proposed Collection; Comment

Request for Form 1120–H

AGENCY: Internal Revenue Service (IRS),

Treasury.

ACTION: Notice and request for

comments.

SUMMARY: The Department of the

Treasury, as part of its continuing effort

to reduce paperwork and respondent

burden, invites the general public and

other Federal agencies to take this

opportunity to comment on proposed

and/or continuing information

collections, as required by the

Paperwork Reduction Act of 1995,

Public Law 104–13 (44 U.S.C.

3506(c)(2)(A)). Currently, the IRS is

soliciting comments concerning Form

1120–H, U.S. Income Tax Return for

Homeowners Associations.

DATES: Written comments should be

received on or before August 26, 1996,

to be assured of consideration.

ADDRESSES: Direct all written comments

to Garrick R. Shear, Internal Revenue

Service, room 5571, 1111 Constitution

Avenue NW., Washington, DC 20224.

FOR FURTHER INFORMATION CONTACT:

Requests for additional information or

copies of the form(s) and instructions

should be directed to Martha R. Brinson,

(202) 622–3869, Internal Revenue

Service, room 5571, 1111 Constitution

Avenue NW., Washington, DC 20224.

SUPPLEMENTARY INFORMATION:

Title: U.S. Income Tax Return for

Homeowners Associations.

OMB Number: 1545–0127.

Form Number: Form 1120–H.

Abstract: Homeowners associations

file Form 1120–H to report income,

deductions, and credits. The form is

also used to report the income tax

liability of the homeowners association.

The IRS uses Form 1120–H to determine

if the income, deductions, and credits

have been correctly computed. The form

is also used for statistical purposes.

Current Actions: There are no changes

being made to this form at this time.

Type of Review: Extension of a

currently approved collection.

Affected Public: Business or other forprofit organizations and individuals or

households.

Estimated Number of Respondents:

60,000.

Estimated Time Per Respondent: 32

hrs. 32 min.

Estimated Total Annual Burden

Hours: 1,951,800.

REQUEST FOR COMMENTS: Comments

submitted in response to this notice will

be summarized and/or included in the

request for OMB approval. All

comments will become a matter of

public record. Comments are invited on:

(a) Whether the collection of

information is necessary for the proper

performance of the functions of the

agency, including whether the

information shall have practical utility;

(b) the accuracy of the agency’s estimate

of the burden of the collection of

information; (c) ways to enhance the

quality, utility, and clarity of the

information to be collected; (d) ways to

minimize the burden of the collection of

information on respondents, including

through the use of automated collection

techniques or other forms of information

technology; and (e) estimates of capital

or start-up costs and costs of operation,

maintenance, and purchase of services

to provide information.

Approved: June 17, 1996.

Garrick R. Shear,

IRS Reports Clearance Officer.

[FR Doc. 96–16340 Filed 6–25–96; 8:45 am]

BILLING CODE 4830–01–U

Proposed Collection; Comment

Request for Forms SS–4 and SS–4PR

AGENCY: Internal Revenue Service (IRS),

Treasury.

ACTION: Notice and request for

comments.

SUMMARY: The Department of the

Treasury, as part of its continuing effort

to reduce paperwork and respondent

burden, invites the general public and

other Federal agencies to take this

opportunity to comment on proposed

and/or continuing information

collections, as required by the

Paperwork Reduction Act of 1995,

Public Law 104–13 (44 U.S.C.

3506(c)(2)(A)). Currently, the IRS is

soliciting comments concerning Forms

SS–4, Application for Employer

Identification Number, and SS–4PR,

Solicitud de Numero de Identificacion

Patronal (EIN).

DATES: Written comments should be

received on or before August 26, 1996,

to be assured of consideration.

ADDRESSES: Direct all written comments

to Garrick R. Shear, Internal Revenue

Service, room 5571, 1111 Constitution

Avenue NW., Washington, DC 20224.

FOR FURTHER INFORMATION CONTACT:

Requests for additional information or

copies of the form(s) and instructions

should be directed to Martha R. Brinson,

(202) 622–3869, Internal Revenue

Service, room 5571, 1111 Constitution

Avenue NW., Washington, DC 20224.

SUPPLEMENTARY INFORMATION:

Title: Form SS–4, Application for

Employer Identification Number, and

Form SS–4PR, Solicitud de Numero de

Identificacion Patronal (EIN).

OMB Number: 1545–0003,

Form Number: Forms SS–4 and SS–

4PR.

Abstract: Taxpayers who are required

to have an identification number for use

on any return, statement, or other

document must prepare and file Form

SS–4 or Form SS–4PR (Puerto Rico

only) to obtain a number. The

information is used by the Internal

Revenue Service and the Social Security

Administration in tax administration

and by the Bureau of the Census for

business statistics.

Current Actions: There are no changes

being made to these forms at this time.

Type of Review: Extension of a

currently approved collection.

Affected Public: Business or other forprofit organizations, individuals or

households, not-for-profit institutions,

farms, Federal government and state,

local or tribal governments.

Estimated Number of Respondents:

3,217,362.

Estimated Time Per Respondent: 1hr.

30 min.

Estimated Total Annual Burden

Hours: 4,826,457.

REQUEST FOR COMMENTS: Comments

submitted in response to this notice will

be summarized and/or included in the

request for OMB approval. All