Final PRA Supporting Statement Section - October 23 2017 to PC

SUPPORTING STATEMENT FOR FINAL RULE UNDER THE SECURITIES
EXCHANGE ACT OF 1934 AND DODD-FRANK WALL STREET REFORM
AND CONSUMER PROTECTION ACT
This supporting statement is part of a submission under the Paperwork Reduction
Act of 1995 (“PRA”).1
A.

JUSTIFICATION
1.

CIRCUMSTANCES MAKING THE COLLECTION OF
INFORMATION NECESSARY

In Release No. 33-9877 (“Adopting Release”),2 the Securities and Exchange
Commission (“Commission”) adopted amendments to Item 4023 of Regulation S-K4
(“Item 402”) and Form 8-K5 under the Securities Exchange Act of 1934 (“Exchange
Act”)6 to implement Section 953(b) of the Dodd-Frank Wall Street Reform and
Consumer Protection Act (“Dodd-Frank Act”).7 Section 953(b)(1) directs the
Commission to amend Item 402 to require each registrant, other than an emerging growth
company, as that term is defined in Section 3(a) of the Exchange Act, to disclose in any
filing of the registrant described in Item 10(a) of Regulation S-K (or any successor
thereto):8 (A) the median of the annual total compensation of all employees of the
registrant, except the chief executive officer (“CEO”) (or any equivalent position) of the
registrant; (B) the annual total compensation of the CEO (or any equivalent position) of
the registrant; and (C) the ratio of the median of the total compensation of all employees
of the registrant to the annual total compensation of the CEO of the registrant.9 Section
953(b)(2) of the Dodd-Frank Act specifies that, for purposes of Section 953(b), “total
compensation” of an employee of a registrant shall be determined in accordance with
Item 402(c)(2)(x) of Regulation S-K as in effect on the day before the date of enactment

1

44 U.S.C. §3501, et seq.

2

Pay Ratio Disclosure, Release No. 33-9877 (Aug. 5, 2015) [80 FR 50104].

3

17 CFR 229.402.

4

17 CFR 229.10 et seq.

5

17 CFR 249.308.

6

15 U.S.C. 78a et seq.

7

Public Law No. 111-203, sec. 953(b), 124 Stat. 1376, 1904 (2010), as amended by Public Law No.
112-106, sec. 102(a)(3), 126 Stat. 306, 309 (2012). Section 102(a)(3) of the JOBS Act amended
Section 953(b) of the Dodd-Frank Act to provide an exemption for registrants that are emerging
growth companies as that term is defined in Section 3(a) of the Exchange Act.

8

17 CFR 229.10(a).

9

In the Adopting Release, instead of using the term “CEO,” the Commission uses the term “principal
executive officer” (or “PEO”) to be consistent with the language of current Item 402.

1

of the Dodd-Frank Act.10
The amendments contain “collection of information” requirements within the
meaning of the PRA. The titles for the collection of information are:


“Regulation S-K” (OMB Control No. 3235-0071);11



“Form 10-K” (OMB Control No. 3235-0063);12



“Regulation 14A and Schedule 14A” (OMB Control No. 3235-0059);13



“Regulation 14C and Schedule 14C” (OMB Control No. 3235-0057);14



“Form 8-K” (OMB Control No. 3235-0060);15



“Form S-1” (OMB Control No. 3235-0065);16



“Form S-4” (OMB Control No. 3235-0324);17



“Form S-11” (OMB Control No. 3235-0067);18



“Form 10” (OMB Control No. 3235-0064);19 and



“Form N-2” (OMB Control No. 3235-0026).20

10

The requirements for calculating total compensation under Item 402(c)(2)(x) are the same as those in
effect on July 20, 2010, which was the day before the date of enactment of the Dodd-Frank Act.

11

The paperwork burden from Regulation S-K is imposed through the forms that are subject to the
disclosures in Regulation S-K and is reflected in the analysis of those forms. To avoid a Paperwork
Reduction Act inventory reflecting duplicative burdens, for administrative convenience, the
Commission estimates the burden imposed by Regulation S-K to be a total of one hour.

12

17 CFR 249.310.

13

17 CFR 240.14a-1 et seq.

14

17 CFR 240.14c-1 et seq.

15

17 CFR 249.220f.

16

17 CFR 239.11.

17

17 CFR 239.25.

18

17 CFR 239.18.

19

17 CFR 249.210.

20

17 CFR 239.14 and 274.11a-1.

2

2.

PURPOSE AND USE OF THE INFORMATION COLLECTION

The purpose of the amendments is to implement Section 953(b) of the DoddFrank Act. To satisfy this statutory mandate, the Commission adopted a new paragraph
(u) to Item 402 of Regulation S-K and a conforming amendment to Form 8-K. Although
some components of the new disclosure requirements are already provided by registrants
under existing rules, the amendments require new disclosure of the median of the annual
total compensation of all employees and the pay ratio. The disclosure required by new
Item 402(u) must be provided in any annual report, proxy or information statement, or
registration statement that requires executive compensation disclosure pursuant to Item
402.21
To synchronize the pay ratio rule with existing rules for the disclosure of PEO
compensation when certain elements of compensation are not yet known, the
Commission adopted a conforming amendment to Item 5.02 of Form 8-K that adds a new
paragraph (f)(2). Under this amendment, registrants may omit pay ratio disclosure until
the salary or bonus of their PEOs total compensation is calculable. Once the pay ratio
disclosure is calculable, the registrant is required to disclose the pay ratio in a Form 8-K
filing.
3.

CONSIDERATION GIVEN TO INFORMATION TECHNOLOGY

The forms that require the new disclosure requirement are filed electronically
with the Commission using the Commission’s Electronic Data Gathering and Retrieval
(“EDGAR”) system.
4.

DUPLICATION OF INFORMATION

We are not aware of any rules that conflict with or substantially duplicate the final
regulation.
5.

REDUCING THE BURDEN ON SMALL ENTITIES

Under Commission rules, an issuer, other than an investment company,22 is a
“small business” or “small organization” if it has total assets of $5 million or less as of
the end of its most recent fiscal year and is engaged or proposing to engage in an offering

21

Consistent with the scope of Section 953(b), the new requirements do not apply to the annual reports
and proxy and information statements of emerging growth companies, smaller reporting companies, or
foreign private issuers. In addition, consistent with the instructions J and I of Form 10-K, the new
requirements will not apply to the annual reports of issuers of asset-backed securities or to whollyowned subsidiary registrants.

22

An investment company is a “small business” or “small organization” if, together with other
investment companies in the same group of related investment companies, it has net assets of $50
million or less as of the end of its most recent fiscal year. 17 CFR 270.0-10.

3

of securities which does not exceed $5 million.23 The Commission believes that the final
rule will affect some small entities that are business development companies that have a
class of securities registered under Section 12 of the Exchange Act. The Commission
estimates that there are approximately five of those business development companies that
may be considered small entities.24
The final rule excludes emerging growth companies, smaller reporting companies,
and foreign private issuers. An “emerging growth company” is an issuer that had total
annual gross revenues of less than $1 billion during its most recently completed fiscal
year.25 A smaller reporting company is an issuer, other than certain classes of issuers
(including investment companies), that had a public float of less than $75 million as of
the end of its most recently completed second fiscal quarter, or in the case of an initial
registration statement under the Securities Act or Exchange Act for the shares of its
common equity, had a public float of less than $75 million as of a date within 30 days of
the date of filing of the registration statement.26 To the extent that a small entity is a
registrant, the Commission believes that there are few, if any, small entities that do not
qualify as emerging growth companies or smaller reporting companies because it is
unlikely that an entity with total assets of $5 million or less would have total annual gross
revenues of $1 billion or more, or would have a public float of $75 million or more.
Because emerging growth companies and smaller reporting companies are excluded from
the new disclosure requirement, the Commission believes that the final rule applies to
few, if any, small entities, other than the five business development companies.
In the Adopting Release, the Commission certified, pursuant to 5 U.S.C. 605(b),
that the final rule will not have a significant economic impact on a substantial number of
small entities.
6.

CONSEQUENCES OF NOT CONDUCTING COLLECTION

The pay ratio rule is designed to allow shareholders to better understand and
assess a specific registrant’s compensation practices. Overall, the final rule will provide
investors with information Congress intended them to have to assess the compensation
and accountability of a company’s PEO while seeking to limit the costs and practical
difficulties of providing the disclosure. Failure to require the collection of information
would frustrate the statutory intent of Section 953(b) of the Dodd-Frank Act.
23

See Securities Act Rule 157 [17 CFR 230.157] and Exchange Act Rule 0-10(a) [17 CFR 240.0-10(a)].

24

The Commission estimates that there are 13 business development companies that will be subject to
the final rule, five of which may be considered small entities for purposes of the Regulatory Flexibility
Act.

25

See Securities Act Section 2(a)(19) [15 U.S.C. 77b(a)(19)].

26

See Securities Act Rule 405 [17 CFR 230.405]. In the case of an issuer whose public float was zero,
the issuer could qualify as a smaller reporting company if it had annual revenues of less than $50
million during the most recently completed fiscal year for which audited financial statements are
available

4

7.

SPECIAL CIRCUMSTANCES
None

8.

CONSULTATIONS WITH PERSONS OUTSIDE THE AGENCY

In Release No. 33-9452 (“Proposing Release”), the Commission proposed rule
amendments to implement Section 953(b)27 and solicited comment on the new
“collection of information” requirements and associated paperwork burdens.
Additionally, to facilitate public input on rulemaking required by the Dodd-Frank Act,
members of the public interested in making their views known were invited to submit
comment letters in advance of the official comment period for the proposed rules.28
These comments were received before the Commission published the Proposing Release.
Many commenters provided comments at the pre-proposal stage and after the Proposing
Release was published. The Commission and staff also participated in an ongoing
dialogue with representatives of various market participants and other government
agencies through meetings and public conferences.
Although the Commission received letters from only two commenters that
addressed the PRA estimates explicitly,29 it received a number of other comment letters
and submissions that discussed the costs and burdens to issuers generally that would have
an effect on the PRA analysis.30 The Commission considered all comments received
prior to publishing the final rule as required by 5 C.F.R. 1320.11(f). These letters are
available to the public on the Commission’s website at http://www.sec.gov/comments/s707-13/s70713.shtml.
9.

PAYMENT OR GIFT TO RESPONDENTS
Not applicable.

10.

CONFIDENTIALITY
Not applicable.

27

Pay Ratio Disclosure, Release No. 33-9452 (Sept. 18, 2013) [78 FR 60560].

28

The Commission provided a series of e-mail links, organized by topic, for these letters on its website at
http://www.sec.gov/spotlight/regreformcomments.shtml, so that the public could provide comments
before the Commission proposed a rule. The comments relating to Section 953(b) are located at
http://www.sec.gov/comments/df-title-ix/executive-compensation/executive-compensation.shtml

29

See letters from Center on Executive Compensation (Dec. 2, 2013) and (Sept. 26, 2014) and from U.S.
Chamber of Commerce (May 22, 2014).

30

See, e.g., letters from Avery Dennison Corporation (Nov. 26, 2013); Exxon Mobil Corporation (Dec.
2, 2013); FEI Company (Oct. 16, 2013); and KBR, Inc. (Nov. 26, 2013).

5

11.

SENSITIVE QUESTIONS

No information of a sensitive nature, including social security numbers, will be
required under Form 10-K and Form 8-K collections of information. The information
collections collect basic Personally Identifiable Information (PII) that may include name
and job title. However, the agency has determined that the information collections do not
constitute a system of record for purposes of the Privacy Act. Information is not retrieved
by a personal identifier. In accordance with Section 208 of the E-Government Act of
2002, the agency has conducted a Privacy Impact Assessment (PIA) of the EDGAR
system, in connection with this collection of information. The EDGAR PIA, published
on January 29, 2016, is provided as a supplemental document and is also available at
https://www.sec.gov/privacy.
12/13. ESTIMATES OF HOUR AND COST BURDENS
For purposes of the PRA for the final rule, the Commission estimates the total
annual increase in the paperwork burden for all affected companies to comply with the
collection of information requirements in the final rule is approximately 2,367,573 hours
of company personnel time and approximately $315,390,720 for the services of outside
professionals. These estimates include the time and the cost of implementing data
gathering systems and disclosure controls and procedures, compiling necessary data,
preparing and reviewing disclosure, filing documents and retaining records.
In deriving these estimates, the Commission assumed that:

31



Registrants subject to the final rule would satisfy the new requirements by
either including the information directly in annual reports on Form 10-K or
incorporating the information by reference from a proxy statement on
Schedule 14A or information statement on Schedule 14C. The Commission’s
estimates assume that substantially all of the burden relating to the new
disclosure requirements would be associated with Form 10-K;



For registrants that would be permitted to provide their pay ratio disclosure in
a filing made in accordance with Item 5.02 of Form 8-K, rather than in Form
10-K, the burden relating to the new disclosure requirements would be
associated primarily with Form 10-K rather than Form 8-K because Item 5.02
provides a delayed method of filing information that would otherwise be
required in the registrant’s annual report or proxy or information statement;31
and



100% of new registrants would use the transition provisions allowing them to
omit the required disclosure from their initial registration statements and, for

The Commission’s PRA estimates for Form 8-K include an estimated one hour burden to account for
the inclusion of the new pay ratio disclosure.

6

follow-on offerings by these registrants, the burden relating to the new
disclosure requirements would be associated primarily with Form 10-K rather
than Forms S-1, S-11, or N-2 as applicable (because registrants would
incorporate the disclosure from Form 10-K).
As discussed more fully in the PRA section of the attached Adopting Release, the
Commission received a number of comments regarding the estimated costs of the
proposal. The Commission understands from these comments that the burdens and costs
of compliance will likely vary among individual companies based on a number of factors,
including the size and complexity of their organizations; the nature of their operations
and workforce; the location of their operations; and, significantly, the extent that their
existing payroll systems collect the information necessary to identify the median of the
annual total compensation of their employees.
Because the final rule provides additional flexibility in identifying the median and
the annual total compensation of employees, the actual burden could be lower if the
methodology used is able to reduce the effort needed to collect the data or if the registrant
is able to use information that it collects for other purposes. The Commission believes
that the actual burdens will likely vary significantly among individual companies based
on these factors. The Commission’s estimates reflect average burdens, and, therefore,
some companies may experience costs in excess of its estimates and some companies
may experience costs that are lower than its estimates.
In the Commission’s analysis of the economic costs and benefits of the rule, it
estimated that the total initial compliance costs would be $1,314,694,544 or
approximately $368,159 per registrant. This estimate did not break down the costs
between internal burden hours and external costs, which is how the burdens and costs are
described for PRA purposes. As discussed in the Adopting Release, the Commission
believes that substantially all of the burden relating to the new disclosure requirements
will be associated with Form 10-K. For Exchange Act reports on Form 10-K, the
Commission estimates that 75% of the burden of preparation is carried by the company
internally and that 25% of the burden of preparation is carried by outside professionals.
Using this formula, the Commission estimates that the average registrant will spend 1,105
internal burden hours preparing and reviewing the disclosure for its initial year of
compliance.32
In the Proposing Release, the Commission estimated that the internal burden
hours would be greatest during the first year of compliance with the rule and would
32

The Commission did not receive any estimates of the cost per hour related to preparation of disclosures
by the company internally, but it expects that such costs will be less than the cost of hiring outside
professionals. For ease of analysis, the Commission assumes that internal hourly costs will be
approximately half the cost of hiring outside professionals ($400 / 2 = $200). Assuming 75% of
burden hours are carried internally and 25% are carried externally, the average compliance cost of
$368,159 per registrant corresponds to $368,159 / ((.75)$200 + (.25)$400) = 1,473 hours, of which
1,105 hours (1,473(.75)) are internal and 368 hours (1,473(.25)) are external.

7

diminish in subsequent years. Because of the limited number of ongoing cost estimates
received from commenters, and the wide dispersion of the ones that were received, for
the purposes of the final rule’s PRA, the Commission assumes that ongoing compliance
burdens and costs will be approximately 40% (the median of the estimates provided by
commenters) of the initial compliance burdens and costs. Thus, the Commission utilizes
an estimated burden of 1,105 hours in the initial year and 44233 hours in the two years
thereafter, for a three-year average burden of 663 hours.34
Commenters provided a wide range of estimated external cost burdens. Based on
these comments, as discussed above, the Commission estimates that total compliance
burdens for the initial year of compliance will be $1,314,694,544 or $368,159 per
registrant. Assuming that 25% of the burden of preparing the disclosure is carried by
outside professionals, the Commission estimates that the average registrant will incur
$147,200 in outside professional costs in the first year to comply with the disclosure
requirement.35
As with the estimated internal burden hours, the Commission assumes that the
compliance costs after the initial year will be reduced because a substantial portion of the
costs will be related to establishing systems and processes to collect the payroll data in
the initial year of compliance. Applying the same assumption used above that the
ongoing compliance costs will be approximately 40% of the estimate for the initial
compliance year, the Commission estimates that ongoing compliance costs will be
approximately $58,880 per year on average for each affected company,36 so that the
three-year average cost of compliance is $88,320.37
In addition to estimating the overall total annual increase in cost and hour burdens
for affected companies, the Commission has also estimated the cost and hour burdens for
each collection of information.
Only Forms 10-K that are filed by registrants that are not smaller reporting
companies or emerging growth companies will be required to include the pay ratio
disclosure. For purposes of the PRA estimates, the Commission assumes that 100% of
asset-backed securities issuers will omit Item 402 disclosure from Form 10-K pursuant to
Instruction J of Form 10-K and 100% of wholly-owned subsidiary registrants will omit
Item 402 disclosure from Form 10-K pursuant to Instruction I of Form 10-K, and,
accordingly, these registrants will also not be subject to the new disclosure requirements.
Based on a review of EDGAR filings in calendar year 2014, the Commission estimates
that of the approximately 7,619 annual reports filed in that year, approximately 3,571
33

1,105 x 40% = 442 burden hours.

34

(1,105 + 442 + 442) / 3 = 663 burden hours.

35

368 x $400 = $147,200.

36

$147,200 x 40% = $58,880.

37

($147,200 + 58,880 + 58,880) / 3 = $88,320.

8

annual reports are filed by registrants that would be subject to the new disclosure
requirements.38 The Commission estimates that the new disclosure requirements will add
an average of 663 burden hours39 to the total burden hours required to produce each Form
10-K that is subject to the new requirements and approximately $88,320 for outside
professionals.40
The Commission estimates that the preparation of annual reports currently results
in a total annual compliance burden of 12,228,620 hours and an annual cost of outside
professionals of $1,631,470,000. Under the final rule, the Commission estimates that the
total incremental cost of outside professionals for annual reports will be approximately
$315,389,390 per year and the total incremental internal burden will be approximately
2,367,563 hours per year.
The amendment to Item 402 requires a registrant that is filing its PEO total
compensation on a delayed basis on Form 8-K due to the unavailability of certain
components of compensation (in accordance with Instruction 1 to Items 402(c)(2)(iii) and
(iv) of Regulation S-K and Item 5.02(f) of Form 8-K) to provide the pay ratio disclosure
in that form at the same time. The conforming amendment to Item 5.02 of Form 8-K also
requires a registrant to include updated pay ratio disclosure in the Form 8-K that it files to
disclose its PEO total compensation information. The Commission estimates that the
burden for adding the pay ratio disclosure to that Form 8-K filing will be one hour per
registrant. The Commission also estimates that the Form 8-K amendment will not result
in additional Form 8-K filings because registrants who omit disclosure in reliance on
Instruction 1 to Items 402(c)(2)(iii) and (iv) are already required to file a Form 8-K. The
amendments will, however, add pay ratio disclosure requirements to that Form 8-K filing.
Based on a review of EDGAR filings for calendar years 2012 and 2013, the
Commission estimates that on average approximately 11 Forms 8-K are filed pursuant to
Item 5.02(f) annually and approximately 10 of these relate to disclosure of PEO
compensation. As a result, the Commission estimates that 10 of the Forms 8-K filed in a
given year will require one additional hour for preparing the disclosure required by the
38

Based on a review of EDGAR filings in 2014, approximately 678 annual reports were filed by
emerging growth companies, 2,958 by smaller reporting companies, and 412 by asset-backed securities
issuers.

39

The Commission estimates that 10 of the Forms 8-K filed in a given year would require one additional
hour for preparing the disclosure required by the amendments. Thus, substantially all the internal
burden of the pay ratio disclosure is allocated to Form 10-K: 663 x 3,571 – (1 x 10) = 2,367,563 or
approximately 663 [2,367,563 / 3,571 = 663] per response. Burden hours are rounded to the next hour.

40

The Commission estimates that the requirement to provide updated pay ratio disclosure on Form 8-K
will result in one additional burden hour for that form. The Commission attributes the external costs of
the required pay ratio disclosure proportionately between Form 10-K and Form 8-K based on the
estimated internal burden hours for each form. (1 / (663 + 1)) x $88,320 = $133 per Form 8-K
response. The remaining costs have been attributed to Form 10-K: $88,320 x 3,571 – $133 x 10 =
$315,389,390 in aggregate or $88,320 [$315,389,390 / 3,571 = $88,320] per response. Costs are
rounded up to the next dollar.

9

amendments, in addition to the total burden hours required to produce each Form 8-K.
The Commission estimates that the preparation of current reports on Form 8-K
currently results in a total annual compliance burden of 507,665 hours and an annual cost
of outside professionals of $67,688,700. As result of the rule, the Commission estimates
that the incremental company burden will be approximately 10 hours per year and
approximately $1,330 in the incremental cost of outside professionals for current reports
on Form 8-K.
There is no change to the estimated burden of the collection of information under
Forms 10, S-1, S-4, S-11,41 or N-242 or under Schedules 14A and 14C43 because the
Commission assumes that the burden relating to the new disclosure requirements will be
associated primarily with Form 10-K. Also, while the adopted amendments would make
revisions to Regulation S-K, the collection of information requirements for that
regulation are reflected in the burden hours estimated for the forms and schedules
discussed above. The rules in Regulation S-K do not impose any separate burden.
Consistent with historical practice, the Commission is retaining an estimate of one burden
hour to Regulation S-K for administrative convenience.
Tables 1 and 2 below illustrate the total annual compliance burden of the
collection of information in hours and in cost under the final rule for annual reports on
41

Because the Commission assumes that all new registrants will take advantage of the transition period
afforded to them under the final rule, so that all of the registration statements on Forms 10, S-1, and S11 that will be required to include the pay ratio disclosure will incorporate by reference the registrant’s
disclosure contained in its annual report, it also assumes that all of the burden relating to the new
disclosure requirements will be associated with Form 10-K. Similarly, the Commission assumes that
registrants filing on Form S-4 for whom executive compensation information under Item 402 is
required pursuant to Items 18 or 19 of Form S-4 will incorporate by reference the pay ratio disclosure
contained in the registrant’s annual report. Thus, the Commission assumes that all of the burden
relating to the new disclosure requirements will be associated with Form 10-K.

42

Only Forms N-2 filed by business development companies (“BDCs”) are subject to the new disclosure
requirements. Furthermore, the final rule applies only to BDCs internally managed such that they
compensate their own employees. Rather, such employees are generally compensated by the BDC’s
investment adviser. Because the Commission assumes that all of the Forms N-2 that will be filed by
internally managed BDCs will incorporate by reference the registrant’s disclosure contained in its
annual report, it also assumes that all of the burden relating to the new disclosure requirements would
be associated with Form 10-K.

43

Only proxy statements on Schedule 14A and information statements on Schedule 14C that are required
to include Item 402 information, and that are not filed by smaller reporting companies or emerging
growth companies, are required to include the new pay ratio disclosure. For purposes of the
Commission’s PRA estimates, consistent with past amendments to Item 402, it has assumed that all of
the burden relating to the new disclosure requirements will be associated with Form 10-K, even if
registrants include the new disclosure required in Form 10-K by incorporating that disclosure by
reference from a proxy statement on Schedule 14A or an information statement on Schedule 14C. The
Commission took a similar approach in connection with the rules for Summary Compensation Table
disclosure required by the 2006 amendments to Item 402. See Executive Compensation and Related
Person Disclosure, Release No. 33-8732A (Aug. 29, 2006) [71 FR 53158 (Sept. 9, 2006)].

10

Form 10-K and current reports on Form 8-K under the Exchange Act.44 The burden
estimates were calculated by multiplying the estimated number of annual responses by
the estimated average number of hours it will take a company to prepare and review the
new disclosure.
Table 1: Incremental Paperwork Burden under the Final Rule

Form 10-K

Form 8-K

Total

14.

Number of
Annual
Responses
(A)

Hour
Burden Per
Response
(B)

Total Incremental
Company Burden
Hours
(C) = (A) * (B)

Incremental
Professional Costs
(D)

Total Incremental
Professional Costs
(E) = (A) * (D)

3,571

663

2,367,563

$88,320

$315,389,390

10

1

10

$133

$1,330

--

----

2,367,573

$315,390,720

COSTS TO FEDERAL GOVERNMENT

We estimate that the cost of preparing the final regulation is approximately
$150,000.
15.

REASON FOR CHANGE IN BURDEN

Table 2 below shows the changes to the total annual compliance burden of the
collections of information in hours and cost. The total estimated burdens were calculated
by adding the incremental burdens to the existing burdens.

44

Figures in both tables have been rounded to the nearest whole number – the 663 figure is rounded up
from 662.9972 and $88,320 figure is rounded up from $88,319.6276.

11

Table 2: Calculation of Total PRA Burden Estimates
Current
Annual
Responses
(A)45

Current
Burden
Hours
(B)

Increase in
Burden
Hours
(C) 46

Burden
Hours (D) =
(B) + (C)

Current
Professional
Costs
(E)

Increase in
Professional
Costs
(F)

Professional
Costs
(G) = (E) + (F)

Form
10-K

8,137

12,228,620

2,367,563

14,596,183

$1,631,470,000

$315,389,390

$1,946,859,390

Form
8-K

118,387

507,665

10

507,675

$67,688,700

$1,330

$67,690,030

Total

126,524

12,736,285

2,367,573

15,103,858

$1,699,158,700

$315,390,720

$2,014,549,420

16.

INFORMATION COLLECTION PLANNED FOR STATISTICAL
PURPOSES
Not applicable.

17.

APPROVAL TO OMIT OMB EXPIRATION DATE

We request authorization to omit the expiration date on the electronic version of
this form for design and scheduling reasons. Including the expiration date on the
electronic version of the form will result in increased costs, because the need to make
changes to the form may not follow the EDGAR application’s scheduled version release
dates. The OMB control number will be displayed.
18.

EXCEPTIONS TO CERTIFICATION FOR PAPERWORK REDUCTION
ACT SUBMISSIONS
Not applicable.

B.

STATISTICAL METHODS
Not applicable.

45

For these forms, the number of current annual responses reflected in the table equals the three-year
average of the number of forms filed with us and currently reported by us to OMB.

46

The increase in burden hours reflected in the table is based on the aggregate incremental burden hours
per form multiplied by the annual responses that will be required to include additional disclosure under
the new rules as adopted. As explained earlier, for purposes of determining the total increase in burden
hours, the Commission reduced the current number of annual responses to reflect that the disclosure
requirements will not apply to all forms filed.

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