On May 21, the SEC finalized amendments to its rules and forms revising the disclosure requirements for financial statements relating to acquisitions and dispositions of businesses, which were adopted in substantially the same form as proposed in May 2019. The amendments were effected “to enhance the quality of information that investors receive while eliminating unnecessary costs and burdens.” The final amendments will, among other things, update the definition of “significant subsidiary” in Rule 1-02(w) of…

One of the key areas of disclosure focus for the Securities and Exchange Commission (SEC) following the emergence of the COVID-19 pandemic was the impact that the pandemic might have on the presentation of non-GAAP financial measures for public companies.  For example, when providing  disclosure guidance for how registrants should approach COVID-19-related considerations in CF Disclosure Guidance: Topic No. 9, issued by the Division of Corporation Finance on March 25, 2020 (CF Disclosure Topic 9),…

In case you missed it, we discussed virtual annual meetings at our recent Public Company Town Hall Webinar: Securities Law Guidance for First Quarter Reporting Season. Access the recording here. Among the numerous considerations related to upcoming annual stockholder meetings being hosted solely using remote (virtual) communication as a result of the novel coronavirus (COVID-19) pandemic, one question that several clients and colleagues have raised is whether management must host a “live” question and answer…

As calendar-year public companies are beginning to prepare their Quarterly Report on Form 10-Q (Form 10-Q) for their first quarter, the novel coronavirus (COVID-19) pandemic and the related societal and economic impact continues to evolve. One important item that companies will need to consider as part of their Form 10-Q preparation is whether any new (or expanded) risk factors relating to COVID-19 should be included in their Form 10-Q. Form 10-Q requires companies to disclose…

In a previous blog post, we discussed certain high-level considerations for first-quarter 2020 earnings releases and guidance in the context of the macroeconomic uncertainty brought about by the novel coronavirus (COVID-19) pandemic.  We indicated our expectation that a significant number of registrants would elect to withdraw guidance in light of this uncertainty. To get a more comprehensive view of how registrants have approached financial guidance, we analyzed disclosures in earnings releases by off-calendar year-end…

For public companies and for market participants generally, the impacts of the coronavirus (COVID-19) pandemic have been unpredictable, swift, and universal.  In a groundbreaking joint statement entitled “The Importance of Disclosure – For Investors, Markets and Our Fight Against COVID-19,” issued on April 8, Jay Clayton, the Chairman of the U.S. Securities and Exchange Commission (SEC), and William Hinman, Director of the SEC’s Division of Corporation Finance, tackled the question of how public companies should…

On March 23, the Division of Enforcement of the Securities and Exchange Commission (SEC) issued a Statement warning against insider trading during the ongoing COVID-19 pandemic.  In particular, the SEC cautioned that insiders are “regularly learning” new material non-public information (MNPI) that may “hold an even greater value than under normal circumstances.”  The SEC also noted that unique circumstances mean more people may have access to MNPI than may typically be the case.  This is…