Title 15, Commerce and TradeRelease 119-110
§7219 Funding
Title 15 › CHAPTER 98 — PUBLIC COMPANY ACCOUNTING REFORM AND CORPORATE RESPONSIBILITY › SUBCHAPTER I — PUBLIC COMPANY ACCOUNTING OVERSIGHT BOARD › § 7219
Summary
The Board and the designated standard-setting body must pay for their work from the funds and rules this section sets out. Each must make a budget every fiscal year and approve it under their own procedures at least 1 month before that fiscal year starts (or at the start of the Board’s first, possibly short, fiscal year). The Board’s budget also needs the approval of the Commission. The Board must prepare its first-year budget quickly after the initial five Board members are appointed so it can do start-up tasks. The budgets are paid mainly by annual accounting support fees and other receipts, not by public U.S. money. The Board’s recoverable budget is reduced by any registration or annual fees collected the previous year. Money from fines the Board collects may fund a merit scholarship program for undergraduate and graduate students in accredited accounting programs, but only if Congress provides that money in advance in an appropriations Act. The Board, with the Commission’s approval, sets a reasonable annual accounting support fee and the rules for charging and collecting it from issuers and from brokers and dealers. Broker and dealer fees start with support for the first full fiscal year beginning after July 21, 2010. The amount each issuer pays is tied to its average monthly market capitalization over the 12 months before the fiscal year; each broker or dealer pays in proportion to its net capital versus all brokers and dealers. Fees cannot exceed the recoverable budget. The Board and the standard-setting body do not become dependent on Congress for funding and may use other income (like publication sales) if the Commission believes their independence is not harmed. The Treasury may advance start-up funds from unspent fiscal year 2003 Commission appropriations, up to the amount needed for the Board’s first fiscal year.
Full Legal Text
Title 15, §7219
Commerce and Trade, Source: USLM XML via OLRC
(a)In general
The Board, and the standard setting body designated pursuant to section 77s(b) of this title, shall be funded as provided in this section.
(b)Annual budgets
The Board and the standard setting body referred to in subsection (a) shall each establish a budget for each fiscal year, which shall be reviewed and approved according to their respective internal procedures not less than 1 month prior to the commencement of the fiscal year to which the budget pertains (or at the beginning of the Board’s first fiscal year, which may be a short fiscal year). The budget of the Board shall be subject to approval by the Commission. The budget for the first fiscal year of the Board shall be prepared and approved promptly following the appointment of the initial five Board members, to permit action by the Board of the organizational tasks contemplated by section 7211(d) of this title.
(c)Sources and uses of funds
(1)Recoverable budget expenses
The budget of the Board (reduced by any registration or annual fees received under section 7212(e) of this title for the year preceding the year for which the budget is being computed), and all of the budget of the standard setting body referred to in subsection (a), for each fiscal year of each of those 2 entities, shall be payable from annual accounting support fees, in accordance with subsections (d) and (e). Accounting support fees and other receipts of the Board and of such standard-setting body shall not be considered public monies of the United States.
(2)Funds generated from the collection of monetary penalties
Subject to the availability in advance in an appropriations Act, and notwithstanding subsection (j), all funds collected by the Board as a result of the assessment of monetary penalties shall be used to fund a merit scholarship program for undergraduate and graduate students enrolled in accredited accounting degree programs, which program is to be administered by the Board or by an entity or agent identified by the Board.
(d)Annual accounting support fee for the Board
(1)Establishment of fee
The Board shall establish, with the approval of the Commission, a reasonable annual accounting support fee (or a formula for the computation thereof), as may be necessary or appropriate to establish and maintain the Board. Such fee may also cover costs incurred in the Board’s first fiscal year (which may be a short fiscal year), or may be levied separately with respect to such short fiscal year.
(2)Assessments
The rules of the Board under paragraph (1) shall provide for the equitable allocation, assessment, and collection by the Board (or an agent appointed by the Board) of the fee established under paragraph (1), among issuers, in accordance with subsection (g), and among brokers and dealers, in accordance with subsection (h), and allowing for differentiation among classes of issuers, brokers and dealers, as appropriate.
(3)Brokers and dealers
The Board shall begin the allocation, assessment, and collection of fees under paragraph (2) with respect to brokers and dealers with the payment of support fees to fund the first full fiscal year beginning after July 21, 2010.
(e)Annual accounting support fee for standard setting body
The annual accounting support fee for the standard setting body referred to in subsection (a)—
(1)shall be allocated in accordance with subsection (g), and assessed and collected against each issuer, on behalf of the standard setting body, by 1 or more appropriate designated collection agents, as may be necessary or appropriate to pay for the budget and provide for the expenses of that standard setting body, and to provide for an independent, stable source of funding for such body, subject to review by the Commission; and
(2)may differentiate among different classes of issuers.
(f)Limitation on fee
The amount of fees collected under this section for a fiscal year on behalf of the Board or the standards setting body, as the case may be, shall not exceed the recoverable budget expenses of the Board or body, respectively (which may include operating, capital, and accrued items), referred to in subsection (c)(1).
(g)Allocation of accounting support fees among issuers
Any amount due from issuers (or a particular class of issuers) under this section to fund the budget of the Board or the standard setting body referred to in subsection (a) shall be allocated among and payable by each issuer (or each issuer in a particular class, as applicable) in an amount equal to the total of such amount, multiplied by a fraction—
(1)the numerator of which is the average monthly equity market capitalization of the issuer for the 12-month period immediately preceding the beginning of the fiscal year to which such budget relates; and
(2)the denominator of which is the average monthly equity market capitalization of all such issuers for such 12-month period.
(h)Allocation of accounting support fees among brokers and dealers
(1)Obligation to pay
Each broker or dealer shall pay to the Board the annual accounting support fee allocated to such broker or dealer under this section.
(2)Allocation
Any amount due from a broker or dealer (or from a particular class of brokers and dealers) under this section shall be allocated among brokers and dealers and payable by the broker or dealer (or the brokers and dealers in the particular class, as applicable).
(3)Proportionality
The amount due from a broker or dealer shall be in proportion to the net capital of the broker or dealer (before or after any adjustments), compared to the total net capital of all brokers and dealers (before or after any adjustments), in accordance with rules issued by the Board.
(i)Omitted
(j)Rule of construction
Nothing in this section shall be construed to render either the Board, the standard setting body referred to in subsection (a), or both, subject to procedures in Congress to authorize or appropriate public funds, or to prevent such organization from utilizing additional sources of revenue for its activities, such as earnings from publication sales, provided that each additional source of revenue shall not jeopardize, in the judgment of the Commission, the actual and perceived independence of such organization.
(k)Start-up expenses of the Board
From the unexpended balances of the appropriations to the Commission for fiscal year 2003, the Secretary of the Treasury is authorized to advance to the Board not to exceed the amount necessary to cover the expenses of the Board during its first fiscal year (which may be a short fiscal year).
Legislative History
Notes & Related Subsidiaries
Editorial Notes
Codification Section is comprised of section 109 of Pub. L. 107–204. Subsec. (i) of section 109 of Pub. L. 107–204 amended section 78m of this title.
Amendments
2010—Subsec. (c)(2). Pub. L. 111–203, § 982(h)(1), substituted “subsection (j)” for “subsection (i)”. Subsec. (d)(2). Pub. L. 111–203, § 982(h)(2)(A), substituted “and among brokers and dealers, in accordance with subsection (h), and allowing for differentiation among classes of issuers, brokers and dealers, as appropriate” for “allowing for differentiation among classes of issuers, as appropriate”. Subsec. (d)(3). Pub. L. 111–203, § 982(h)(2)(B), added par. (3). Subsecs. (h) to (k). Pub. L. 111–203, § 982(h)(3), (4), added subsec. (h) and redesignated former subsecs. (h) to (j) as (i) to (k), respectively.
Statutory Notes and Related Subsidiaries
Effective Date
of 2010 AmendmentAmendment by Pub. L. 111–203 effective 1 day after July 21, 2010, except as otherwise provided, see section 4 of Pub. L. 111–203, set out as an
Effective Date
note under section 5301 of Title 12, Banks and Banking. Obligation of Funds for Accounting Scholarship Program Pub. L. 116–93, div. C, title VI, § 620(b), Dec. 20, 2019, 133 Stat. 2481, provided that: “Beginning in fiscal year 2021 and for each fiscal year thereafter, the Board [Public Company Accounting Oversight Board] shall have authority to obligate funds for the scholarship program established by section 109(c)(2) of the Sarbanes-Oxley Act of 2002 (Public Law 107–204) [15 U.S.C. 7219(c)(2)] in such fiscal year in an aggregate amount not exceeding the amounts of funds collected by the Board between October 1 and September 30 of such fiscal year, including accrued interest, as a result of the assessment of monetary penalties. Funds made available for obligation in any fiscal year shall be in addition to amounts made available in prior fiscal years and shall remain available until expended.” Monetary Penalties To Fund Scholarships for Accounting Students Pub. L. 116–6, div. D, title VI, § 620, Feb. 15, 2019, 133 Stat. 184, provided in part that: “Beginning in fiscal year 2020 and for each fiscal year thereafter, monetary penalties collected pursuant to 15 U.S.C. 7215 shall be deposited in the Public Company Accounting Oversight Board account as discretionary offsetting receipts.”
Reference
Citations & Metadata
Citation
15 U.S.C. § 7219
Title 15, Commerce and Trade
Last Updated
Sep 22, 2026
Release point: 119-110