With the SEC likely to receive a fraction of the increased funding it had requested (according to the proposed Congressional budget for FY 2014), the agency is looking to employ streamlined examination procedures. Targeting the 1,000 advisors with three years’ experience that have never been examined, it’s likely that the SEC will use procedures previously employed for private funds, focusing on specific, high-risk areas. That approach has enabled the agency to reduce the examination period from 150 to 75 days. Previously, the SEC had announced that it would increase full examinations for firms that have never been audited.
The agency had requested an additional $353 million but received only $29 million in the proposed budget, bringing its total funding to $1.35 billion. Much of the additional funding would have been used to hire 250 examiners to augment their current staff of 400.
