2014-02-12T14:30:08-06:00 2013-09-30 861065772 DELOITTE TAX LLP 1750 TYSONS BLVD MCLEAN VA 221024219 990 2012-10-01 521042433 MUNICIPAL SECURITIES RULEMAKING BOARD MUNI 7037976600 1900 DUKE STREET ALEXANDRIA VA 223143412 LYNNETTE KELLY 7037976600 2014-02-12 1 YVETTE WOODS P00364424 7032511000 2012 2015-11-30 17:44:51Z LYNNETTE KELLY 1900 DUKE STREET ALEXANDRIA VA 223143412 39270359 0 X WWW.MSRB.ORG X 1975 VA PROTECT INVESTORS AND MUNICIPAL ENTITIES BY PROMOTING A FAIR AND EFFICIENT MUNICIPAL MARKET. 21 21 121 0 0 0 35445924 35067556 4405387 4098182 41352 104621 0 0 39892663 39270359 0 150000 0 0 13993705 15423472 0 0 0 12843007 12204858 26836712 27778330 13055951 11492029 50041243 60813189 3646681 2933965 46394562 57879224 X SEE SCHEDULE OTHE MISSION OF THE MSRB IS TO PROTECT INVESTORS, STATE AND LOCAL GOVERNMENT ISSUERS, OTHER MUNICIPAL ENTITIES, AND THE PUBLIC INTEREST BY PROMOTING A FAIR AND EFFICIENT MUNICIPAL MARKET THROUGH: 1. ESTABLISHING RULES FOR DEALERS AND MUNICIPAL ADVISORS; 2. COLLECTING AND DISSEMINATING MARKET INFORMATION, AND 3. ENGAGING IN MARKET LEADERSHIP, OUTREACH AND EDUCATION. 0 0 ESTABLISHING REGULATIONS FOR DEALERS AND MUNICIPAL ADVISORS: SEE SCHEDULE OESTABLISHING REGULATIONS FOR DEALERS AND MUNICIPAL ADVISORS: THE MSRB WAS CREATED BY CONGRESS TO REGULATE SECURITIES FIRMS, BANKS AND MUNICIPAL ADVISORS THAT ENGAGE IN MUNICIPAL SECURITIES AND MUNICIPAL ADVISORY ACTIVITIES (COLLECTIVELY "REGULATED ENTITIES") WITH THE GOAL OF PROTECTING INVESTORS, MUNICIPAL ENTITIES, OBLIGATED PERSONS AND THE PUBLIC INTEREST. MSRB RULES SEEK TO PREVENT MANIPULATION AND FRAUD IN THE MUNICIPAL MARKET, PROMOTE FAIR, SAFE AND EFFICIENT TRANSACTIONS, AND SUPPORT A FREE AND OPEN MARKET IN MUNICIPAL SECURITIES AND MUNICIPAL FINANCIAL PRODUCTS. MSRB RULES ARE DEVELOPED WITH EXTENSIVE INPUT FROM THE PUBLIC AND THE MUNICIPAL SECURITIES INDUSTRY, AND MUST BE APPROVED BY THE SECURITIES AND EXCHANGE COMMISSION (SEC) PRIOR TO EFFECTIVENESS, UNLESS OTHERWISE ALLOWED BY LAW. IN ADDITION, THE MSRB'S ACTIVITIES ARE SUBJECT TO THE GENERAL OVERSIGHT OF THE SEC. THE MSRB FOLLOWS ESTABLISHED PROCEDURES FOR COORDINATING COOPERATIVELY WITH ENFORCEMENT AGENCIES CHARGED WITH ENFORCING MSRB RULES. THE MSRB ALSO HAS ESTABLISHED PROGRAMS IN CONNECTION WITH THE QUALIFICATION OF PROFESSIONALS EMPLOYED BY REGULATED ENTITIES.INFORMATION REGARDING THE MSRB'S RULES AND OTHER IMPORTANT INFORMATION OR DEVELOPMENTS WITH AN IMPACT ON THE PROTECTION OF INVESTORS, MUNICIPAL ENTITIES AND OBLIGATED PERSONS IS DISPLAYED ON THE MSRB'S CORPORATE WEBSITE, AT WWW.MSRB.ORG.DURING FY 2013, REGULATORY HIGHLIGHTS INCLUDE: - MSRB RULES G-11, G-8 AND G-32: INCLUDED PROVISIONS SPECIFICALLY TAILORED FOR RETAIL ORDER PERIODS;- MSRB RULE G-39: AMENDED TELEMARKETING RULE TO ALIGN WITH RULES OF OTHER REGULATORS;- MSRB RULES G-37 AND G-8: AMENDED RULES TO REQUIRE PUBLIC DISCLOSURE OF ADDITIONAL INFORMATION RELATED TO MUNICIPAL SECURITIES DEALER CONTRIBUTIONS TO BOND BALLOT CAMPAIGNS; AND,- MSRB RULES G-32 AND G-34: STREAMLINED NEW ISSUE INFORMATION SUBMISSION REQUIREMENTS FOR MUNICIPAL SECURITIES DEALERS. COLLECTING AND DISSEMINATING MARKET INFORMATION: SEE SCHEDULE OCOLLECTING AND DISSEMINATING MARKET INFORMATION: THE MSRB COLLECTS MUNICIPAL MARKET DOCUMENTS AND DATA (COLLECTIVELY "INFORMATION") FROM REGULATED ENTITIES, MUNICIPAL ENTITIES, OBLIGATED PERSONS, AND/OR THEIR AGENTS AND MAKES THE INFORMATION WIDELY AVAILABLE. MSRB'S COLLECTION OF INFORMATION SERVES A CRITICAL ROLE IN PRESERVING FAIRNESS AND EFFICIENCY OF THE MUNICIPAL MARKET. BY REDISSEMINATING THIS INFORMATION TO MUNICIPAL MARKET PARTICIPANTS, AND TO REGULATORS CHARGED WITH EXAMINING FOR COMPLIANCE WITH AND ENFORCING MSRB RULES, AND OTHER REGULATORY AND POLICYMAKING BODIES, THE MSRB ENSURES THAT THE MARKET OPERATES TRANSPARENTLY AND EFFICIENTLY.UNDER ITS RULEMAKING AUTHORITY, THE MSRB HAS ESTABLISHED "INFORMATION FACILITIES" THAT PROVIDE THE LEGAL FOUNDATION FOR THE COLLECTION AND DISSEMINATION OF MUNICIPAL MARKET INFORMATION. THESE FACILITIES PROVIDE THE MSRB WITH THE AUTHORITY TO COLLECT MUNICIPAL TRANSACTION PRICES (WITH RESPECT TO CUSTOMER AND INTER-DEALER TRANSACTIONS IN MUNICIPAL SECURITIES); OFFICIAL STATEMENTS, PRELIMINARY OFFICIAL STATEMENTS, AND ADVANCE REFUNDING DOCUMENTS (IN CONNECTION WITH NEW ISSUES OF MUNICIPAL SECURITIES); CONTINUING DISCLOSURE DOCUMENTS (IN CONNECTION WITH OUTSTANDING ISSUES OF MUNICIPAL SECURITIES); INTEREST RATE INFORMATION AND RELATED DOCUMENTATION FOR CERTAIN SHORT-TERM OBLIGATIONS (IN CONNECTION WITH OUTSTANDING VARIABLE RATE DEMAND OBLIGATIONS AND AUCTION RATE SECURITIES); AND INFORMATION REGARDING BUSINESS UNDERTAKEN BY, AND CERTAIN POLITICAL CONTRIBUTIONS MADE BY, BROKERS, DEALERS, AND MUNICIPAL SECURITIES DEALERS OR THEIR PROFESSIONALS AND CERTAIN RELATED POLITICAL ACTION COMMITTEES (IN CONNECTION WITH THE MSRB'S PAY-TO-PLAY RULE). THE MSRB PROVIDES MOST OF THIS INFORMATION TO THE PUBLIC, FREE OF CHARGE, ON ITS ELECTRONIC MUNICIPAL MARKET ACCESS (EMMA) WEBSITE AT EMMA.MSRB.ORG. IN ADDITION, ACCESS TO MOST INFORMATION COLLECTED BY THE MSRB IS AVAILABLE TO SUBSCRIBERS THROUGH PAID AUTOMATED SUBSCRIPTION SERVICES. AS OF THE END OF FY 2013, THE MSRB OFFERED FIVE PRINCIPAL DATA PRODUCTS WITH APPROXIMATELY 125 ACTIVE SUBSCRIPTION AGREEMENTS.ENHANCEMENTS TO MARKET INFORMATION PROVIDED ON EMMA, AS WELL AS THE FUNCTIONALITY OF THE WEBSITE, PROVIDED BY THE MSRB DURING FY 2013 INCLUDE: - ENHANCED THE EMMA MARKET STATISTICS PAGE TO INCLUDE MONTHLY DATA ON NEW ISSUANCE VOLUME;- BEGAN TO DISPLAY BOTH THE INITIAL OFFERING DOLLAR PRICE AND YIELD FOR A BOND AS WELL AS THE TIME OF FORMAL AWARD AND TIME OF FIRST EXECUTION FOR MOST NEW ISSUES OF MUNICIPAL SECURITIES;- ADDED ACCESS ON EMMA TO MUNICIPAL SECURITIES DEALERS' DISCLOSURES OF POLITICAL CONTRIBUTIONS AND EXPANDED DISCLOSURES CONCERNING DEALER CONTRIBUTIONS TO BOND BALLOT CAMPAIGNS;- BEGAN TO DISPLAY IN REAL-TIME ON EMMA PAR VALUE ON ALL TRANSACTIONS OF $5 MILLION OR LESS TO PROVIDE MORE COMPLETE AND TIMELY INFORMATION ABOUT MUNICIPAL SECURITIES TRADES;- REQUIRED MUNICIPAL SECURITIES DEALERS TO REPORT THE CONTRACTUAL DOLLAR PRICE AT WHICH INTER-DEALER TRANSACTIONS WERE EXECUTED AND ADDED YIELD TO THIS INFORMATION;- CONFORMED BID-TO-COVER RATIOS FOR AUCTION RATE SECURITIES TO A CALCULATION THAT IS MORE CONSISTENT WITH TREASURY AUCTION RESULTS;- DEVELOPED A FREE EMAIL REMINDER SERVICE TO NOTIFY MUNICIPAL SECURITIES ISSUERS IN ADVANCE OF THEIR FILING DEADLINES FOR FINANCIAL DISCLOSURES TO HELP ENSURE USERS HAVE THE MOST CURRENT INFORMATION;- ENHANCED THE SEARCH FUNCTIONALITY ON EMMA TO ALLOW USERS TO SEARCH BY A COMBINATION OF DESCRIPTIVE CHARACTERISTICS OF MUNICIPAL SECURITIES AS WELL AS TRADE DATA AND DISCLOSURES;- ADDED ALERTS FOR DISCLOSURES RELATED TO 529 COLLEGE SAVINGS PLANS;- FACILITATED MONITORING OF SECURITIES OR A MARKET SEGMENT BY ENABLING SPECIFIC SECURITIES TO BE SAVED IN GROUPS AND SEARCHES TO BE CONDUCTED ON THOSE SECURITIES, AND ADDED THE ABILITY TO SAVE FREQUENTLY USED SETS OF SEARCH CRITERIA;- INTRODUCED A LIMITED PILOT "ISSUER HOMEPAGE" THAT WOULD PROVIDE A NEW MEANS FOR NAVIGATING ON EMMA TO FIND ISSUERS AND DATA AND DISCLOSURES ABOUT THEIR BONDS, AS WELL AS ENABLING ISSUERS TO IMPROVE COMMUNICATION WITH INVESTORS THROUGH EMMA; AND, - INTRODUCED MYEMMA, WHICH PROVIDES CUSTOMIZED ACCESS TO MUNICIPAL SECURITIES INFORMATION BY ALLOWING USERS TO SET UP ALERTS TO BE NOTIFIED WHEN NEW INFORMATION ON A PARTICULAR SECURITY OR GROUP OF SECURITIES BECOMES AVAILABLE ON EMMA. ENGAGING IN EDUCATION, OUTREACH AND MARKET LEADERSHIP: SEE SCHEDULE OENGAGING IN EDUCATION, OUTREACH AND MARKET LEADERSHIP: THE MSRB ENGAGES MUNICIPAL MARKET PARTICIPANTS, REGULATORS AND POLICY MAKERS TO BUILD UNDERSTANDING OF THE MUNICIPAL MARKET AND TO PROMOTE PRACTICES AND POLICIES, AS WELL AS PROBLEM-SOLVING, THAT PROTECT INVESTORS, MUNICIPAL ENTITIES, OBLIGATED PERSONS AND THE PUBLIC INTEREST. THE MSRB ALSO ENGAGES IN EDUCATION AND OUTREACH ACTIVITIES TO SUPPORT THE UNDERSTANDING OF THE MUNICIPAL MARKET AND TO HELP FURTHER PROTECT INVESTORS, MUNICIPAL ENTITIES, OBLIGATED PERSONS AND THE PUBLIC INTEREST.DURING FYI 2013, HIGHLIGHTS IN THIS AREA INCLUDE:- SPONSORED THE SEMI-ANNUAL MSRB INDUSTRY ROUNDTABLE, REINFORCING THE MSRB'S REPUTATION AS A FACILITATOR IN MARKET-WIDE DISCUSSIONS ABOUT IMPORTANT ISSUES;- SPONSORED A SERIES OF ROUNDTABLES ON PUBLIC PENSION PLANS;- PRODUCED THREE INVESTOR EDUCATION VIDEOS ON THE ROLE OF THE MSRB IN THE MUNICIPAL MARKET, HOW TO USE THE EMMA WEBSITE TO MAKE INFORMED DECISIONS AND WHAT INVESTORS SHOULD EXPECT WHEN WORKING WITH A BROKER;- ADDED NEW RESOURCES TO THE ONLINE "MSRB INVESTOR TOOLKIT" TO HELP MUNICIPAL BOND INVESTORS NAVIGATE THE MARKET AND MAKE DECISIONS ABOUT MUNICIPAL BONDS;- ADDED A SERIES OF NEW RESOURCES ON FINANCIAL DISCLOSURE AND OTHER TOPICS TO THE ELECTRONIC "MSRB STATE AND LOCAL GOVERNMENT TOOLKIT" TO HELP MUNICIPAL BOND ISSUERS BETTER UNDERSTAND THE BOND ISSUANCE PROCESS AND THE EMMA WEBSITE;- HOSTED FREE, PUBLIC WEBINARS ON NEW MSRB RULES AND MARKET TRANSPARENCY INITIATIVES; AND, - TESTIFIED AT A SECURITIES AND EXCHANGE COMMISSION ROUNDTABLE ON FIXED INCOME MARKETS ON "POTENTIAL IMPROVEMENTS TO MARKET STRUCTURE FOR MUNICIPAL SECURITIES". 0 0 0 1 0 0 0 0 0 1 0 0 0 1 1 1 0 0 0 0 0 0 0 0 0 0 1 0 1 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 38 0 1 121 1 0 0 0 0 0 0 0 X 21 21 0 0 0 0 0 0 1 1 1 0 0 1 1 1 1 1 1 1 0 0 X X BONNIE MOYNIHAN 7037976600 1900 DUKE STREET SUITE 600 ALEXANDRIA VA 223143412 ALAN D POLSKY 11.00 X 80300 0 0 BENJAMIN S THOMPSON 5.00 X 50300 0 0 CRAIG A NOBLE 5.00 X 0 0 0 DALL FORSYTHE 5.00 X 46100 0 0 DANIEL HEIMOWITZ 5.00 X 45000 0 0 DAVID J MADIGAN 5.00 X 50300 0 0 EDWARD J DE LA ROSA 5.00 X 45000 0 0 GENE SAFFOLD 5.00 X 984 0 0 JOSEPH J GERACI 5.00 X 46100 0 0 KYM S ARNONE 5.00 X 0 0 0 MARCY EDWARDS 5.00 X 0 0 0 MARIANNE F EDMONDS 5.00 X 0 0 0 MILROY ALEXANDER 5.00 X 45300 0 0 NOREEN P WHITE 5.00 X 50300 0 0 PETER J TAYLOR 5.00 X 46100 0 0 RICHARD ELLIS 5.00 X 0 0 0 ROBERT A FIPPINGER 5.00 X 45300 0 0 ROBERT A LAMB 5.00 X 55300 0 0 ROBIN L WIESSMANN 5.00 X 0 0 0 SHERYL D BAILEY 5.00 X 45300 0 0 W BARTLEY HILDRETH 5.00 X 0 0 0 JAY M GOLDSTONE 7.00 X X 50300 0 0 STEPHEN E HEANEY 5.00 X X 50000 0 0 AMYTIS G RAMOS 40.00 X 76434 0 32107 ELIZABETH A WOLFE 40.00 X 315454 0 34929 LYNNETTE KELLY 40.00 X 968627 0 149780 RONALD W SMITH 40.00 X 178322 0 26530 SARA MAJROH 40.00 X 95766 0 14714 ALAN MORISATO 40.00 X 306319 0 20320 ERNESTO A LANZA 40.00 X 485971 0 28104 MARGARET HENRY 40.00 X 167020 0 18984 KAREN DU BRUL 40.00 X 249702 0 30767 KATHLEEN MILES 40.00 X 256360 0 23092 LAWRENCE P SANDOR 40.00 X 316092 0 20766 LESLIE CAREY 40.00 X 238645 0 30380 RITTA MCLAUGHLIN 40.00 X 267940 0 30979 ADELA CEPEDA 5.00 X 42414 0 0 C CHRISTOPHER TROWER 5.00 X 45300 0 0 JOHN E PETERSON 5.00 X 23292 0 0 KATHLEEN A MCDONOUGH 5.00 X 22313 0 0 KEVIN L WILLENS 5.00 X 50000 0 0 MARK G MULLER 5.00 X 45300 0 0 MICHAEL G BARTOLOTTA 5.00 X 45000 0 0 4948255 0 461452 33 1 1 0 C C PACE SYSTEMS INC 4100 MONUMENT CORNER DRIVE SUITE 4 FAIRFAX VA 22030 SOFTWARE DEVELOPMENT 1598198 SUTHERLAND GLOBAL SERVICES 1160 PITTSFORD-VICTOR ROAD PITTSFORD NY 14534 CALL CENTER 305562 GRANT THORNTON LLP 33562 TREASURY CENTER CHICAGO IL 60694 INTERNAL AUDIT 102900 QUATT ASSOCIATES 2233 WISCONSIN AVENUE NW SUITE 50 WASHINGTON DC 20007 COMPENSATION CONSULTANTS 102657 4 35067556 35067556 RULE VIOLATION REVENUE 900099 2364098 2364098 DATA SUBSCRIPTIONS 900099 1596614 1596614 PROF QUAL EXAM FEES 900099 122820 122820 OTHER 900099 14650 14650 4098182 104621 104621 39270359 4202803 0 0 150000 4247803 8815666 655939 996320 707744 99787 132361 1970279 493222 1143507 2230243 536427 248426 3419279 188312 ELECTRONIC INFO FEE 1208347 DUES, REGIST. & TRAININ 209229 MSRB PUBLICATIONS 96554 TEMP AGENCY STAFF 69051 159834 27778330 2646902 1048336 38785 3065112 8087805 6288424 393609 584622 29747344 23264411 6412406 6482933 32461736 43343762 50041243 60813189 2081436 1727316 1565245 1206649 3646681 2933965 X 46394562 57879224 0 0 46394562 57879224 50041243 60813189 11492029 -7367 0 X 0 1 X 1 0 0 1 0 1874816 1292544 582272 3023837 2012474 1011363 24848691 19959393 4889298 6482933 DEFERRED RENT 1070070 DEFERRED COMPENSATION 136579 1206649 39262992 -7367 -7367 39270359 0 39270359 27778330 0 27778330 0 27778330 THE MSRB IS EXEMPT FROM FEDERAL AND STATE TAXES ON INCOME (OTHER THAN UNRELATED BUSINESS INCOME) UNDER SECTION 501(C)(6) OF THE INTERNAL REVENUE CODE AND APPLICABLE INCOME TAX REGULATIONS OF THE COMMONWEALTH OF VIRGINIA. THE MSRB FILES AN ANNUAL INFORMATIONAL TAX FORM, FORM 990, WITH THE INTERNAL REVENUE SERVICE. THE MSRB REALIZED NO UNRELATED BUSINESS INCOME IN FISCAL YEARS 2013 AND 2012 AND NO PROVISION FOR INCOME TAXES HAS BEEN MADE AS OF SEPTEMBER 30, 2013 AND 2012. 1 SECURITIES AND EXCHANGE COMMISSION HISTORICAL SOCIETY 1101 PENNSLYVANIA AVENUE NW WASHINGTON DC 20004 522213646 501(C)(3) 150000 MUNICIPAL SECURITIES VIRTUAL MUSEUM 1 0 PROCEDURE FOR MONITORING GRANTS IN THE U.S.: PART I, LINE 2: SCHEDULE I, PART I, LINE 2: THE ORGANIZATION IS NOT IN THE BUSINESS OF MAKING GRANTS, BUT IN FY 2013 THE ORGANIZATION MADE A GRANT COMMITMENT TO THE SEC HISTORICAL SOCIETY (SOCIETY), IN COMMEMORATION OF THE MSRB'S 40TH ANNIVERSARY, TO SPONSOR THE SOCIETY'S GALLERY ON MUNICIPAL SECURITIES WHICH WILL PERMANENTLY RESIDE IN THE SOCIETY'S VIRTUAL MUSEUM AND ARCHIVE OF THE HISTORY OF FINANCIAL REGULATION. THE MSRB FINANCE COMMITTEE REVIEWED AND APPROVED THE GRANT. X X 1 1 X X X X X X 0 1 0 ELIZABETH A WOLFE 315454 0 0 0 0 0 17500 0 17429 0 350383 0 0 0 LYNNETTE KELLY 652455 0 129468 0 186704 0 122500 0 27280 0 1118407 0 165000 0 RONALD W SMITH 168822 0 9500 0 0 0 16513 0 10017 0 204852 0 0 0 ALAN MORISATO 305077 0 0 0 1242 0 17500 0 2820 0 326639 0 0 0 ERNESTO A LANZA 485077 0 0 0 894 0 22500 0 5604 0 514075 0 0 0 MARGARET HENRY 167020 0 0 0 0 0 12250 0 6734 0 186004 0 0 0 KAREN DU BRUL 247058 0 2500 0 144 0 17387 0 13380 0 280469 0 0 0 KATHLEEN MILES 251309 0 4500 0 551 0 17500 0 5592 0 279452 0 0 0 LAWRENCE P SANDOR 292350 0 22500 0 1242 0 17500 0 3266 0 336858 0 0 0 LESLIE CAREY 236145 0 2500 0 0 0 16966 0 13414 0 269025 0 0 0 RITTA MCLAUGHLIN 267940 0 0 0 0 0 17500 0 13479 0 298919 0 0 0 ADELA CEPEDA 42414 0 0 0 0 0 0 0 0 0 42414 0 0 0 C CHRISTOPHER TROWER 45300 0 0 0 0 0 0 0 0 0 45300 0 0 0 JOHN E PETERSON 23292 0 0 0 0 0 0 0 0 0 23292 0 0 0 KATHLEEN A MCDONOUGH 22313 0 0 0 0 0 0 0 0 0 22313 0 0 0 KEVIN L WILLENS 50000 0 0 0 0 0 0 0 0 0 50000 0 0 0 MARK G MULLER 45300 0 0 0 0 0 0 0 0 0 45300 0 0 0 MICHAEL G BARTOLOTTA 45000 0 0 0 0 0 0 0 0 0 45000 0 0 0 PART I, LINE 1A THE MSRB REIMBURSES BOARD MEMBERS AND THE EXECUTIVE DIRECTOR FOR THE COST OF COACH CLASS AIR TRAVEL FOR FLIGHTS OF 3 HOURS OR LESS IN TOTAL ONE-WAY TRIP DURATION. FOR AIR TRAVEL MORE THAN 3 HOURS IN TOTAL ONE-WAY TRIP DURATION, THE MSRB REIMBURSES BOARD MEMBERS AND THE EXECUTIVE DIRECTOR FOR THE USE OF BUSINESS CLASS WHEN AVAILABLE, OR IF ONLY TWO CLASSES OF SERVICE ARE OFFERED, FIRST CLASS. BOARD MEMBERS AND THE EXECUTIVE DIRECTOR ARE REIMBURSED THE COSTS OF BUSINESS CLASS RAIL FARES. THE MSRB HAS DETERMINED THIS MEETS THE BUSINESS REQUIREMENT STANDARD FOR NOT TREATING THE BENEFIT AS COMPENSATORY ON THE FORM W-2 OR 1099. GROSS-UP PAYMENTS ARE PROVIDED TO THE EXECUTIVE DIRECTOR FOR A TAXABLE SUPPLEMENTAL LIFE INSURANCE POLICY AND LONG-TERM DISABILITY COVERAGE. PART I, LINE 4B LYNNETTE KELLY PARTICIPATED IN A 457(F) SUPPLEMENTAL NONQUALIFIED RETIREMENT PLAN. A DISTRIBUTION OF $177,931 WAS MADE DURING THE YEAR. FORM 990, PART VI, SECTION A, LINE 7B ALL PROPOSED RULE CHANGES ADOPTED BY THE BOARD OF DIRECTORS OF THE MSRB ARE SUBJECT TO THE FILING AND APPROVAL OR REVIEW REQUIREMENTS BY THE SECURITIES AND EXCHANGE COMMISSION UNDER SECTION 19(B) OF THE SECURITIES EXCHANGE ACT OF 1934. FORM 990, PART VI, SECTION B, LINE 11 THE BOARD OF DIRECTORS OF THE MSRB HAS AN AUDIT COMMITTEE THAT IS CHARGED WITH REVIEWING WITH MANAGEMENT THE ORGANIZATION'S COMPLETED FORM ANNUALLY PRIOR TO THE FILING OF SUCH FORM AND REPORTING ANY FINDINGS OR CONCLUSIONS TO THE BOARD OF DIRECTORS IN CONNECTION WITH THE BOARD'S REVIEW OF SUCH FORM. THE AUDIT COMMITTEE AND THE BOARD OF DIRECTORS CONDUCTED THEIR REVIEWS ON 01/29/2014 AND 1/30/2014 RESPECTIVELY. FORM 990, PART VI, SECTION B, LINE 12C THE MSRB MAINTAINS FOR ITS BOARD OF DIRECTORS AND ITS STAFF: A CODE OF ETHICS AND BUSINESS CONDUCT POLICY; A CONFLICTS OF INTEREST POLICY; AND, A WHISTLEBLOWER POLICY WITH COMPLAINT HANDLING PROCEDURES. ALL BOARD MEMBERS AND STAFF ARE ANNUALLY TRAINED ON THESE POLICIES AND MUST SIGN AN ACKNOWLEDGMENT. THE MSRB HAS A POLICY REQUIRING THAT OFFICERS, DIRECTORS AND KEY EMPLOYEES DISCLOSE ANNUALLY INTERESTS THAT COULD GIVE RISE TO CONFLICTS. IN CONNECTION WITH THE ELECTION OF NEW MEMBERS OF THE BOARD OF DIRECTORS, EACH CANDIDATE PROVIDES INFORMATION TO THE MSRB CONCERNING POTENTIAL CONFLICTS OF INTEREST. IN ADDITION, CERTAIN ORGANIZATIONAL CONFLICTS ARE EFFECTIVELY PROHIBITED UNDER SECTION 15B(B) OF THE SECURITIES EXCHANGE ACT OF 1934 DUE TO THE STATUTORY REQUIREMENTS REGARDING QUALIFICATION FOR MEMBERSHIP ON THE BOARD OF DIRECTORS. IN PARTICULAR, PUBLIC REPRESENTATIVES MUST BE INDEPENDENT OF ANY MUNICIPAL SECURITIES BROKER, MUNICIPAL SECURITIES DEALER OR MUNICIPAL ADVISOR. MSRB RULE A-3 DEFINES "INDEPENDENT" AS HAVING NO MATERIAL BUSINESS RELATIONSHIP WITH ANY MUNICIPAL SECURITIES BROKER, MUNICIPAL SECURITIES DEALER OR MUNICIPAL ADVISOR, INCLUDING AT A MINIMUM NOT CURRENTLY OR AT ANY TIME WITHIN THE LAST TWO YEARS BEING ASSOCIATED WITH A MUNICIPAL SECURITIES BROKER, MUNICIPAL SECURITIES DEALER OR MUNICIPAL ADVISOR AND NOT HAVING A RELATIONSHIP WITH ANY MUNICIPAL SECURITIES BROKER, MUNICIPAL SECURITIES DEALER OR MUNICIPAL ADVISOR, WHETHER COMPENSATORY OR OTHERWISE, THAT REASONABLY COULD AFFECT THE INDEPENDENT JUDGMENT OR DECISION MAKING OF THE INDIVIDUAL. THE MSRB'S GENERAL COUNSEL REVIEWS THE CONFLICTS OF INTEREST ACKNOWLEDGEMENT AND DISCLOSURE FORMS AND DETERMINES WHAT ACTIONS, IF ANY, NEED TO BE TAKEN, INCLUDING ASKING A BOARD MEMBER TO RECUSE HIM OR HERSELF FROM DELIBERATIONS OR VOTING ON AN ACTION. FORM 990, PART VI, SECTION B, LINE 15A UNDER THE MSRB WRITTEN COMPENSATION STRATEGY AND PROGRAM, THE FINANCE COMMITTEE (COMPRISED OF MEMBERS OF THE BOARD OF DIRECTORS) IS RESPONSIBLE FOR MAKING RECOMMENDATIONS AND THE BOARD OF DIRECTORS IS RESPONSIBLE FOR APPROVING THE ORGANIZATION-WIDE COMPENSATION STRATEGY. THE ANNUAL SALARY BUDGET IS APPROVED BY THE BOARD OF DIRECTORS. AT LEAST ONCE EVERY FOUR YEARS, THE COMPENSATION STRATEGY AND STRUCTURE ARE REVIEWED AND APPROVED BY THE FINANCE COMMITTEE BASED ON INFORMATION RECEIVED FROM AN EXTERNAL SALARY CONSULTANT. THE EXTERNAL SALARY CONSULTANT COMPARES OUR ORGANIZATION WITH COMPARABLE PEER ORGANIZATIONS IN OUR LOCAL GEOGRAPHIC MARKET AND WITHIN THE INDUSTRY AS APPROPRIATE. THE FULL BOARD APPROVES THE COMPENSATION OF THE EXECUTIVE DIRECTOR, AND THE EXECUTIVE DIRECTOR ESTABLISHES THE COMPENSATION OF THE KEY EMPLOYEES WITHIN THE PARAMETERS AND PHILOSOPHY OF THE APPROVED COMPENSATION STRATEGY. ADDITIONALLY, THE EXECUTIVE DIRECTOR ANNUALLY PROVIDES TO THE BOARD THE SALARY, BENEFITS, AND TOTAL COMPENSATION OF THE SENIOR MANAGEMENT. FORM 990, PART VI, SECTION C, LINE 19 THE ORGANIZATION'S WEBSITE (WWW.MSRB.ORG) CONTAINS THE FOLLOWING: SECURITIES EXCHANGE ACT SECTION 15B (ESTABLISHING STATUTE), RESTATED ARTICLES OF INCORPORATION, BY-LAWS, GOVERNANCE-RELATED ADMINISTRATIVE RULES, BOARD COMMITTEE CHARTERS, CODE OF ETHICS AND BUSINESS CONDUCT, CONFLICTS OF INTEREST POLICY AND DISCLOSURE FORM, RISK MANAGEMENT PROGRAM, WHISTLEBLOWER POLICY, AUDITED FINANCIAL STATEMENTS, THE IRS FORM 990, CERTAIN FINANCIAL POLICIES AND OTHER GOVERNANCE-RELATED POLICIES AND PROCEDURES. FORM 990, PART VI, SECTION A, LINE 2: NO OFFICER, DIRECTOR, TRUSTEE, OR KEY EMPLOYEE HAS A FAMILY RELATIONSHIP OR BUSINESS RELATIONSHIP (AS SUCH TERMS ARE DEFINED FOR PURPOSES OF FORM 990) WITH ANY OTHER OFFICER, DIRECTOR, TRUSTEE, OR KEY EMPLOYEE. AS CONTEMPLATED BY THE CONGRESSIONALLY MANDATED STRUCTURE OF THE MSRB'S BOARD OF DIRECTORS (WHICH SERVES AS THE ORGANIZATION'S GOVERNING BODY) AS A SELF-REGULATORY ORGANIZATION UNDER THE FEDERAL SECURITIES LAWS, THE EMPLOYERS OF SOME MEMBERS OF THE BOARD OF DIRECTORS, AND SUCH MEMBERS IN THEIR CAPACITIES AS EMPLOYEES OF THEIR EMPLOYERS, FROM TIME TO TIME TRANSACT BUSINESS WITH ONE ANOTHER IN THE ORDINARY COURSE OF THEIR BUSINESS AS PARTICIPANTS IN THE MUNICIPAL MARKET ON THE SAME TERMS AS ARE GENERALLY OFFERED TO OTHERS IN THE SAME LINE OF BUSINESS.