FR 2025-04766

The document is a notice from the Securities and Exchange Commission (SEC), announcing their request to the Office of Management and Budget (OMB) to continue approving the collection of information through what is known as Form 11-K. This notice, motivated by the Paperwork Reduction Act of 1995, is a routine procedure ensuring that necessary data collection processes remain in compliance with federal requirements.

General Summary

Form 11-K is an annual report primarily used by employee stock purchase, savings, and similar plans. It helps these plans comply with the reporting requirements outlined in the Securities and Exchange Act of 1934. The purpose of this form is to provide employees with financial information about their investment plans, enabling them to evaluate their performance. The SEC estimates around 941 of these forms are filed each year, requiring an average of 95.81 hours of work per form and costing roughly $7,525 each time it is filed.

Significant Issues or Concerns

There do not appear to be significant issues or concerns noted in the document itself. The SEC is simply following the statutory process laid out for the continuation of data collection approvals. One minor point of consideration is the substantial cost and time burden on entities required to submit Form 11-K. While necessary, this burden may be frustrating, especially for those responsible for preparing the forms.

Impact on the Public

For the general public, this document signifies a behind-the-scenes administrative process that most may not even be aware of. However, for those who are employees of companies with stock purchase or savings plans, the existence and accuracy of Form 11-K are crucial. It ensures transparency and provides these employees with the ability to make informed decisions regarding their investment options and overall financial planning.

Impact on Specific Stakeholders

For specific stakeholders, such as employee stock purchase plans, savings plans, and similar entities, the extension of this collection requirement continues to ensure that they can provide financial clarity and reporting to their participants. Financial managers and administrators within these plans bear the direct impact given the substantial effort required to accurately complete these forms.

Companies that issue these forms may find the requirements to be resource-intensive. The continued need to commit nearly 96 internal hours per filing and incur financial costs may be seen as burdensome, but it is also recognized as a necessary part of regulatory compliance.

Overall, while the extension of the OMB's approval for Form 11-K's information collection may seem procedural, it plays an essential role in maintaining the transparency and accountability of employee investment plans nationwide.

The document at hand involves a submission request made to the Office of Management and Budget by the Securities and Exchange Commission (SEC) concerning an extension of information collection related to Form 11-K. This form is vital for employee stock purchase and savings plans, providing financial information necessary for employees to assess investment vehicles associated with their stock plans.

Financial Summary

In terms of financial references, the document outlines the cost burden associated with Form 11-K. For each response, it is estimated that the cost is approximately $7,525. Given that there are roughly 941 filings of Form 11-K annually, the total annual cost amounts to $7,081,025. These cost estimates likely encompass the efforts and resources required to compile and submit the necessary financial information in compliance with regulatory obligations under the Securities Exchange Act.

Financial Implications

These financial figures reflect the direct expenses incurred by the respondents — typically employers or plan administrators — who are responsible for preparing and filing Form 11-K. The specified amount of $7,525 per response signals the involvement of possibly hiring financial experts or auditing services to ensure accurate and compliant reporting. This substantial cost highlights the regulatory burden placed on entities managing these employee stock plans, which must ensure adherence to federal regulations.

Contextual Understanding

While the document does not outline any issues directly associated with the monetary aspect, the figures indicate a significant financial responsibility required to comply with federal securities law. The calculated burden not only involves financial outlays but also suggests the devotion of crucial internal resources and workforce time, amounting to 95.81 burden hours per response factored into these cost estimates.

This level of financial and time commitment ensures transparency and accuracy in reporting, which is integral for safeguarding the interests of employees participating in these plans. The document importantly allows for public commentary on the financial and procedural aspects of this information collection, providing a platform for any concerns or suggestions to be addressed. The mention of a comment period closing on April 21, 2025, indicates an openness to public scrutiny and adjustments, reinforcing the democratic process in regulatory practices.