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Proposed Collection; Comment Request

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Upon Written Request, Copies Available From: Securities and Exchange Commission, Office of Filings and Information Services, Washington, DC 20549.


Rule 17a-2; SEC File No. 270-442; OMB Control No. 3235-0498.

Notice is hereby given that pursuant to the Paperwork Reduction Act of 1995 (44 U.S.C. 3501 et seq.), the Securities and Exchange Commission (“Commission”) is soliciting comments on the collection of information summarized below. The Commission plans to submit this existing collection of information to the Office of Management and Budget for extension and approval.

Rule 17a-12 under the Securities Exchange Act of 1934 is the reporting rule tailored specifically for OTC derivatives dealers, and Form X-17A-5IIB, the Financial and Operational Combined Uniform Single Report, is the basic document for reporting the financial and operational condition of OTC derivatives dealers.

At this point there is only one registered OTC derivatives dealer, however it is anticipated to affect approximately six (and possibly up to ten) OTC derivatives dealers within the next three years, Rule 17a-12 requires OTC derivatives dealers to file quarterly Financial and Operational Combined Uniform Single Reports (FOCUS)—Form X-17A-5IIB.[1] Rule 17a-12 also requires that OTC derivatives dealers file audited financial statements annually. The staff estimates that the average amount of time necessary to prepare and file the information required by the proposed rule is eighty hours per OTC derivatives dealer [2] with each spending an additional one hundred hours on the annual audit for a total of 180 hours per OTC derivatives dealer annually. Thus the staff estimates that the total number of hours necessary for six OTC derivatives dealers to comply with the requirements of Rule 17a-12 on an annual basis is 1,080 hours.[3]

The staff believes that financial reporting specialists will prepare the FOCUS IIB Report and supporting Schedules, compliance personnel may review the reports to assure compliance with applicable rules, and accountants will prepare the audited annual reports. The staff estimates that the hourly salary of a financial reporting specialist is $72.40 per hour,[4] the hourly salary of a compliance manager is $82.50 per hour,[5] and the hourly salary of a compliance manager is $51.60 per hour.[6] Based upon these numbers, the Start Printed Page 66786total cost of compliance for six respondents is $65,950.00 per year.[7]

Written comments are invited on: (a) Whether the proposed 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 proposed collection of information; (c) ways to enhance the quality, utility, and clarity of the information to be collected; and (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. Consideration will be given to comments and suggestions submitted in writing within 60 days of this publication.

Direct your written comments to Michael E. Bartell, Associate Executive Director, Office of Information Technology, Securities and Exchange Commission, 450 5th Street, N.W. Washington, DC 20549.

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Dated: October 31, 2000.

Margaret H. McFarland,

Deputy Secretary.

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1.  Form X-17a-5 [17 CFR 249.617].

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2.  Based upon an average of 4 responses per year and an average of 20 hours spent preparing each response.

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3.  Or, 1,800 hours annually for 10 OTC derivatives dealers to comply.

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4.  Per Securities Industry Association (SIA) Management and Professional Earnings. Table 011 (Financial Reporting Manager) + 35% overhead (based on end-of-year 1998 figures).

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5.  SIA Management and Professional Earnings, Table 051 (Compliance Manager + 35% overhead (based on end-of-year 1998 figures).

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6.  SIA Management and Professional Earnings, Table 003 (Senior Accountant) + 35% overhead (based on end-of-year 1998 figures).

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7.  (19 hours × $72.40 × 4 filings per year) + (1 hour × $82.50 per hour × 4 filings per year) + (100 hours × $51.60 × 1 filing per year) × six (6) OTC derivatives dealers. The total cost for ten (10) respondents would be $109,924.00 per year.

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[FR Doc. 00-28503 Filed 11-6-00; 8:45 am]