$HOME/.ssh/rc
If this file exists, it is run with the user's shell after reading the environment files but before starting the user's shell or command. If X11 spoofing is in use, this will receive the "proto cookie" pair in standard input (and DISPLAY in environment). This must call xauth in that case.
The primary purpose of this file is to run any initialization routines which may be needed before the user's home directory becomes accessible; AFS is a particular example of such an environment.
This file will probably contain some initialization code followed by something similar to:
if read proto cookie; then echo add $DISPLAY $proto $cookie | xauth -q -; fi
If this file does not exist, /etc/sshrc is run, and if that does not exist either, xauth is used to store the cookie.
This file should be writable only by the user, and need not be readable by anyone else.