In June 2018, when the SEC changed the definition of “smaller reporting company” (SRC) by increasing the public float threshold from $75 million to $250 million and adding a revenue test, the Commission also directed the staff to review the issues in changing the definitions of accelerated and large accelerated filer. (The current definition is at the end of this post if you would like to review it.) These instructions to the staff came…

In the last week there have been two very interesting developments in the SEC’s disclosure effectiveness process.  On May 3, 2019, the SEC formally proposed a rule to “improve the information that investors receive regarding the acquisition and disposition of businesses.”  The SEC indicated that “[t]he proposed amendments are also intended to facilitate more timely access to capital and to reduce complexity and compliance costs of these financial disclosures.”  The proposed rules would change Regulation…

When reading the results of operations section in MD&A it is not unusual to experience a feeling of  déjà vu. When comparing the current year to last year companies will explain why financial statement line items changed with the goal of helping readers understand quality of earnings and the likelihood that past performance predicts future performance. (For a quick review of these objectives you could re-read the SEC’s 2003 MD&A release, FR 72.) Unfortunately, when…

This is a revised version of an earlier post, and demonstrates the risks in trying to get out with information as early as possible!  Drafting this post late yesterday and early this morning the SEC had not yet released updated versions of the cover pages for the forms and I created a version for this post.  And, shortly after I posted our suggested version the SEC updated the forms.  So, you can find the official revised cover pages…

Risk factor disclosure frequently presents a conundrum in public reporting.  The SEC’s risk factor disclosure requirements focus on what makes an investment in a company’s securities “risky or speculative”.  Buy many companies present so many risk factors that questions arise about their relevance to investors.  This is one among a number of reasons the SEC included this disclosure in their March 20, 2019 Disclosure Modernization and Simplification rule. As you likely have heard, most of…

After our recent posts about the disclosure issues surrounding emerging and changing issues including Brexit and Libor, we are returning to our series delving into the details of implementing the SEC’s March 20, 2019 Disclosure Modernization and Simplification rule, and specifically the changes in properties disclosures. As you likely have heard, most of the changes in this rule, including property disclosures, are effective for filings after May 2, 2019. To being reviewing the changes…