Notices. SECURITIES AND EXCHANGE COMMISSION

494 words·~2 min read·/register/2004/02/26/04-4271

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BILLING CODE 8010-01-P SECURITIES AND EXCHANGE COMMISSION [Securities Act of 1933; Release No. 8389/February 20, 2004] [Securities Exchange Act of 1934; Release No. 49290/February 20, 2004] Order Regarding Review of FASB Accounting Support Fee for 2004 Under Section 109 of the Sarbanes-Oxley Act of 2002 The Sarbanes-Oxley Act of 2002 (the “Act”) establishes criteria that must be met in order for the accounting standards established by an accounting standard-setting body to be recognized as “generally accepted” for purposes of the federal securities laws.

Section 109 of the Act provides that all of the budget of an accounting standard-setting body satisfying these criteria 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), the annual accounting support fee shall not exceed the amount of the standard setter's “recoverable budget expenses.

” Section 109(h) 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. On April 25, 2003, the Commission issued a policy statement concluding that the Financial Accounting Standards Board (“FASB”) 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. 1 As a consequence of that recognition, the Commission undertook a review of the FASB's accounting support fee for calendar year 2004.

In connection with its review, the Commission also reviewed the proposed budget for the FAF and the FASB for calendar year 2004. 1 Financial Reporting Release No. 70. Section 109 of the Act also provides that 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 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 Government Accounting Standards Board (“GASB”), the FASB's sister organization, which sets accounting standards to be used by state and local government entities.

The Commission has been advised by the FAF that neither the FAF, the FASB nor the GASB will accept contributions from the accounting profession. After its review, the Commission determined that the 2004 annual accounting support fee for the FASB is consistent with section 109 of the Act. Accordingly, It is ordered, pursuant to section 109 of the Act, that the FASB may act in accordance with this determination of the Commission. By the Commission. Margaret H. McFarland, Deputy Secretary. [FR Doc. 04-4271 Filed 2-25-04; 8:45 am]