TheCorporateCounsel.net

Last week, SEC Chair Gary Gensler testified before the Subcommittee on Financial Services and General Government of the of the U.S. House Committee on Appropriations. Chair Gensler was testifying in support of the Administration’s budget request for the SEC, which seeks $2.436 billion for fiscal 2024. With respect to the Division of Corporation Finance, Gensler noted in his prepared testimony:

The Division of Corporation Finance oversees the disclosures of public companies so that investors can make informed investment decisions. It’s important for investors to receive useful, timely, and accurate disclosure.

During the last three years alone, the number of reporting companies the Division oversees has increased by 18 percent to 7,836, primarily due to initial public offerings. In addition, merger activity has more than tripled 2020 levels in the last two fiscal years. In contrast, the Division’s staff is still approximately 17 percent below FY 2016.

Today’s budget request would grow the team to 454 FTEs. With this increase, the Division still would be five percent smaller than it was in FY 2016. Nonetheless, additional resources would allow the Division to serve investors more ably as markets grow and evolve.

As is always the case, the SEC faces the daunting prospect of regulating a vast landscape with very limited resources, although Gensler acknowledges that recent increases to the agency’s budget have helped bring the SEC’s staffing back up above where it was seven years ago.

– Dave Lynn