Securities and Exchange Commission--Recording of Obligation for Multiple-Year Contract

The Securities and Exchange Commission (SEC) failed to fully record its obligation when it entered into a 10-year contract. The recording statute, 31 U.S.C. 1501(a)(1), requires SEC to record an obligation for its total liability under the contract. Although SEC estimated that its total obligation would be at least $371.7 million, SEC recorded an obligation for only $180,000. SEC had no authority to record an obligation for an amount less than its full liability under this contract.