At today’s open meeting, the Securities and Exchange Commission adopted a final Regulation Best Interest, as well as additional guidance. Final action relating to the broker-dealer standard of conduct had been anxiously anticipated.  The Commission noted that Regulation Best Interest enhances the standard of conduct beyond the current broker-dealer suitability standard.  In addition, the Commission adopted a requirement for a Form CRS Relationship Summary.  The Form CRS will require registered investment advisers and broker-dealers to…

The SEC announced an upcoming roundtable (date and details to come) that will focus on the causes of short-termism, including the role of quarterly disclosures.  At the end of 2018, the SEC had published a request for comment regarding the timing of earnings releases and quarterly reports by public companies.  The statement regarding the roundtable identifies potential topics for discussion, including the following: The role, if any, that short-termism plays in the declining number of…

A recent research piece published by UBS Financial Services discusses the significant variations in IPO winners and losers.  The report notes that after five years about 60% of all IPOs had negative returns.  Variation in long-term performance appears to be correlated with specific IPO characteristics.  Companies with revenues in excess of $1 billion and those backed by growth capital performed better over a three-year period than smaller and venture-backed companies. First-day IPO returns are not…

A partnership (or LLC) can go public in a highly tax-efficient manner by using an “Up-C” structure.  An Up-C structure is composed of two entities: (1) a parent company, a C corporation (“PubCo”) which will be organized as a holding company, and (2) PubCo’s subsidiary, which is the partnership or LLC.  The Up-C structure makes it possible for the partnership/LLC to undertake an IPO while maintaining its partnership status, principal assets and operating business.  It…

The Securities and Exchange Commission proposed amendments to the accelerated filer and large accelerated filer definitions, which have been highly anticipated.  As noted in prior blog posts, at the time that the SEC adopted amended definitions of smaller reporting company, market participants had expected that the SEC would address the thresholds that trigger a requirement for auditor attestation.  If the proposed amendments were to be adopted, smaller reporting companies with less than $100 million in…

On May 3, 2019, the US Securities and Exchange Commission (SEC) proposed revisions to financial statement disclosures with respect to business acquisitions and dispositions required by Regulation S-X’s Rule 3-05 (Financial Statements of Businesses Acquired or to be Acquired (Rule 3-05)), Rule 3-14 (Special Instructions for Real Estate Operations to be Acquired (Rule 3-14)), Article 11 on Pro Forma Financial Information (Article 11), and other related rules and forms. Through these proposed changes, the SEC…

On May 31, the SEC will host the 2019 Fintech Forum, which will focus on issues arising in connection with distributed ledger technology and digital assets.  The Forum will be held at the SEC and will also be webcast.  The agenda can be accessed here: https://www.sec.gov/news/press-release/2019-59.…