Despite reports of internal wrangling among the four Commissioners at the Securities and Exchange Commission (SEC) regarding approval of the report the agency is to send to Congress examining the need for a self-regulatory organization (SRO) for advisors, an SEC official told AdvisorOne that the agency “fully expects” to meet its Jan. 17 deadline.

However, seeing as Jan. 17 is Martin Luther King Day, the SEC may choose to file its report to Congress on the Friday before the national holiday, Jan. 14, or perhaps on Jan. 18. The report the SEC is to send to lawmakers regarding fiduciary duty is due on Jan. 21.

Section 914 of the Dodd-Frank Act required the SEC to review and analyze the need for enhanced examination and enforcement resources for investment advisors. Because the SEC failed to receive more funding under the Senate appropriations bill, the need for an SRO looks highly likely.

“Given that Congress is reluctant to provide the agency with adequate funding, it seems inevitable that they will look to authorize an SRO as a way to beef up oversight without any budget impact,” says Barbara Roper, Director of Investor Protection at the Consumer Federation of America (CFA).

However, Congress has the ultimate authority as to how the SEC will proceed concerning an SRO. For instance, Congress does not need a recommendation or a request from the SEC in order to amend the Investment Advisers Act of 1940 to allow the securities regulator to establish an SRO for advisors.

Three of the four Commissioners must approve the report under Section 914 of Dodd-Frank before it can be sent to Congress. SEC Chairman Mary Schapiro (left) has recused herself from discussing or voting on the SRO report, as the Financial Industry Regulatory Authority (FINRA), her former employer, is being discussed as an SRO candidate. Schapiro’s recusal period is supposed to expire later this month, which will mark her two-year anniversary as SEC chairman.

SEC Commissioner Elisse Walter, another former FINRA employee who was under a one-year recusal period, is said to support the need for an advisor SRO. Luis Aguilar, another SEC Commissioner, has voiced his opposition to an SRO.