The chairman of a House Appropriations subcommittee with oversight of the Securities and Exchange Commission has called on the Government Accountability Office to investigate reported SEC budget shortfalls.

The shortfall, which has been attributed to facility costs in Washington, New York and Boston, is reported to be as great as $48 million.

In a May 24 letter to U.S. Comptroller General David Walker, Rep. Frank Wolf, R-Va., said that he was "troubled" by the reports and asked that a review begin as soon as possible.

"This is very damaging to the SEC," Wolf said. "The SEC polices other people's books, yet they themselves have huge overruns. I am very disappointed."

"The SEC has an obligation - both legal and moral - to come tell Congress about this problem," he added.

In a letter in late May to SEC Chairman William H. Donaldson, Wolf noted that the committee has been "verbally informed that there may be a shortfall of more than $20,000,000 this year and possibly more than $50,000,000 in total through fiscal year 2007."

Wolf wrote, "If the SEC needs to reprogram current-year resources or reconfigure its 2006 request, I urge you to immediately send a formal reprogramming notification for fiscal year 2005 and a budget amendment from the Office of Management and Budget for fiscal year 2006 for the committee's consideration."

The committee also asked the GAO to look into the issue and to report on the amount of funding for the projects that wasn't initially planned; the actions that caused the change in budget plans; the actions taken by the SEC since this budgeting problem was uncovered; and corrective actions to prevent a recurrence.

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