STUDY TO IDENTIFY MEASURES NECESSARY FOR A SUCCESSFUL TRANSITION
TO A MORE ELECTRONIC FEDERAL DEPOSITORY LIBRARY PROGRAM (FDLP)
PRELIMINARY REPORT: TASK 9A: SEC EDGAR SYSTEM
As part of the Study, a task force examined issues surrounding
inclusion of electronic information in the FDLP when that
information is not already included in paper or microfiche
format. The Securities and Exchange Commission (SEC) EDGAR
System was selected as an example. This task force was lead by
Julia Wallace, University of Minnesota Government Publications
Library.
This preliminary report of the task force is being made available
for review and comment. Comments should be submitted by Friday,
February 16, 1996, by internet e-mail to study@gpo.gov, by fax to
FDLP Study at (202) 512-1262, or by mail to FDLP Study, Mail Stop
SDE, U.S. Government Printing Office, Washington, DC 20401.
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TASK 9A: Evaluate issues surrounding inclusion of the Securities
and Exchange Commission (SEC) EDGAR System in the
Federal Depository Library Program when that
information is not already included in paper or
microfiche format.
BACKGROUND
The Securities and Exchange Commission (SEC) administers federal
securities laws. Issuers of securities making public offerings
must file financial and other pertinent data with the SEC. This
information is available in SEC public reading rooms and through
private vendors. It is also available through the SEC's
Electronic Data Gathering, Analysis and Retrieval System (EDGAR)
electronic filing system. According to the SEC the primary
purpose of EDGAR is to "increase the efficiency and fairness of
the securities market for the benefit of investors, corporations,
and the economy by accelerating the receipt, acceptance,
dissemination, and analysis of time-sensitive corporate
information filed with the agency."
EDGAR is used by nearly 75% of publicly traded domestic
companies to make most of their filings. All public companies
will be required to file electronically with the SEC by May,
1996. The SEC receives approximately 12 million documents a
year, and estimates that users download nearly 17,000 documents a
day.
In 1993, the Internet Multicasting Service and New York
University entered into an agreement to test Internet as a
vehicle for making this data available to a larger public. That
two-year experiment was funded by the National Science Foundation
through a grant which expired on October 1, 1995.
In a speech on August 11, 1995, SEC Chairman Arthur Levitt
announced that the SEC would provide access to EDGAR on its own
World Wide Web site. Levitt said "It is a major Commission
priority to use electronic communications to bring clearer,
faster, more complete disclosure to investors as well as to
reduce costs for issuers. This represents a logical step in
our efforts to better inform investors....We've had many
creative offers from the private sector to keep EDGAR on the
Internet..., but all of them would in some way limit the amount
of information available, or else attach too many commercial
strings. Taxpayers and shareholders have already paid to compile
this information--they should not have to pay again."
The SEC Web site provides access to all of the public electronic
filings made from 1994. It supports user access through Web
Browser or Anonymous File Transfer Protocol (FTP). EDGAR access
is provided free of charge on a day-delayed basis. Direct bulk
feed of EDGAR data also can be purchased from Lexis/Nexis, which
operates the EDGAR dissemination service.
The SEC intends to incorporate new technologies and concepts to
facilitate the capture, analysis, and dissemination of the
financial data the SEC is required to obtain. To that end, a
Technology Conference was held on August 14, 1995, followed by a
Request for Information (RFI) in October. The RFI sought
information on the possible privatization of the EDGAR system, in
addition to a number of other policy and technical issues. The
RFI asked whether the agency should continue to maintain and
operate this service, "or should this service be provided by the
private sector either on the Internet or via some other means?"
On January 4, 1996, the SEC issued a second RFI concerning the
EDGAR system. This RFI supplements the first and specifically
solicits comments on several potential EDGAR system
architectures. Unlike the first RFI, which proposed a possible
privatization of the EDGAR service currently provided through the
SEC Web site, all four models presented in the new RFI assume
that "the SEC will retain its Internet site and continue to offer
the current level of EDGAR document dissemination service."
FEDERAL DEPOSITORY LIBRARY DISSEMINATION
Information filed with the SEC has never been part of the FDLP in
paper, electronic or microfiche format. Although at one point SEC
entered into discussions with GPO about creating a CD-ROM version
of their documents, no agreement was ever reached.
DISSEMINATION ALTERNATIVES
Alternative A
EDGAR is maintained on the SEC Web site and the GPO Locator will
direct users, including depository libraries, looking for this
information to SEC.
Benefits
No new product development is needed.
No costs are incurred by GPO or SEC for inclusion of the
information in the FDLP.
The GPO Locator enhances public access to SEC filings by
making them easier to find.
Disadvantages/Problems
Depository libraries without Internet capabilities cannot
access the EDGAR database.
Alternative B
The SEC provides the electronic data to GPO for distribution to
depository libraries on CD-ROM. Preliminary discussions with SEC
about CD-ROM production assumed dissemination of approximately
10,000,000 pages of information per year. This includes Form Q,
Form K, mergers/acquisition, and proxy statement filings. Over a
one year period this would equate to the production of
approximately 52 CD-ROMs. The estimated cost to GPO for
replication and distribution of these discs to 700 depository
libraries would be $182,000. The SEC would be charged for
premastering the discs unless the Transition Plan for the FDLP is
approved, in which case premastering could be taken from the FDLP
appropriation. The GPO Locator would direct users to the SEC Web
site for more immediate access to filings.
Benefits
Currently, depository libraries are better equipped to
handle CD-ROM than online services. According to preliminary
results from the 1995 Biennial Survey, more than 80% of
depository libraries have CD-ROM capabilities through a
stand alone workstation. On the other hand, percentages of
depositories providing Internet access for the public are as
follows:
FTP 423 libraries (30.8%)
WWW (graphical) 516 libraries (37.6%)
WWW (non-graphical) 375 libraries (27.3%)
CD-ROM is a good format for ensuring extended (15-30 year)
access to SEC filings.
Disadvantages/Problems
Additional cost to the FDLP of approximately $182,000 per
year, or more if GPO pays for premastering the discs. Since
SEC filings have never been a part of the FDLP, their
inclusion in the FDLP in electronic format nets no cost
savings for elimination of comparable paper or microfiche
products from the program.
CD-ROMs will not be as timely as the SEC Web service.
However, as access to the SEC Web site is free, depository
libraries still retain a mechanism for timely access of SEC
filings.
ISSUES TO BE ADDRESSED
Permanent Archiving
The National Archives and Records Administration (NARA) is
engaged in negotiations with SEC to identify and schedule
the records of enduring value in the EDGAR system. NARA
has expressed concern about long-term access to files if the
database is privatized, and would prefer in that case to
acquire the data directly on magnetic tape cartridge. Any
EDGAR data transferred to NARA will be non-searchable.
Long Term Access
The SEC has not indicated how long filings will remain
actively available on their Web site. If filings are
"retired" after a few years, access to earlier information
would be available only in SEC reading rooms or through
private vendors.
Methods for Bringing Electronic Information Officially Into the
FDLP
There is no current model for bringing electronic
information stored on remote agency sites officially into
the FDLP. Should there be? Should GPO attempt to establish
interagency agreements for inclusion of material available
from agency Web sites in the FDLP? If so, what limitations,
restrictions or guarantees should be covered by these
agreements? What provisions should be made for extended
FDLP access to this type of information? Is the fact that
the GPO Locator directs users to an agency site enough to
consider the information at that site an "official" part of
the FDLP? What is the responsibility of depository libraries
for providing assistance with information at non-GPO sites?
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Judy Russell <jrussell@gpo.gov>
Comments should be submitted by Friday, February 16, 1996, by
internet e-mail to study@gpo.gov, by fax to FDLP Study at (202)
512-1262, or by mail to FDLP Study, Mail Stop SDE, U.S.
Government Printing Office, Washington, DC 20401.
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