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The SEC’s whistleblower program has reached a new milestone, now having paid out $376 million to 61 individuals since it made its first award payment in 2012.  On March 26, 2019 the program announced payments to two individualstotaling $50 million. This program is clearly having a significant impact in how the enforcement process finds wrong-doing. You can read more about the program here. As always, your thoughts and comments are welcome!…
Here is a brief video overview of this post, hope you find it interesting! As you have likely heard on March 20, 2019, the SEC adopted a final rule for “Disclosure Modernization and Simplification” as part of its responsibilities under the FAST Act.  This new rule makes a number of detailed changes to reports on Form 10-K, 10-Q and, to a lesser extent, Form 8-K.  The rule also makes several broad changes in…
One of the points we make in our workshops is that companies should exercise care to be consistent across all communication vehicles including SEC filings, earnings releases, webpage information and investor presentations.  Someone in every organization should be charged with reviewing all communications to assure they are all singing the same song. The SEC looks at all the channels a company uses to communicate when they review filings.   Inconsistencies in the disclosure across these channels…
As a quick reminder for first quarter-end, the SEC’s Disclosure Update and Simplification Rule last fall added a requirement to the Form 10-Q to include a statement of changes in stockholders’ equity.  This requirement was added via this addition to Article 10-01(a)  of Regulation S-X: (7) Provide the information required by §210.3-04 for the current and comparative year-to-date periods, with subtotals for each interim period. Article 3.04 referred to in the paragraph above is the…
With the new Disclosure Modernization and Simplification Rule we blogged about yesterday going effective 30 days after publication in the Federal Register, we will all likely be scrambling a bit to get up-to-speed with these changes.  To help us along the path PLI will present a One-Hour Briefing on April 12, 2019 titled “Disclosure Effectiveness and Fast Act Amendments”. You can read about the briefing here. As always, your thoughts and comments are welcome!…
On March 20, 2019, the SEC continued modernizing and simplifying their disclosure rules as they adopted a final rule that will: Simplify disclosure and disclosure processes, Revise rules to update and streamline and improve the SEC’s disclosure framework,and Update other rules to account for developments since their adoption or amendment. The changes in the final rule include: Companies will generally be able to exclude discussion of the earliest of three years in MD&A if they…
At this point in the year-end process most of us have numbers in place and are working on the final steps in reporting.  As you move toward final reviews, we share with you Audit Analytics’ list of high-risk financial reporting areas that can hopefully help you avoid reporting problems. For the last 17 years Audit Analyticshas done an exhaustive review of public company restatements.  Their report “2017 Financial Restatements – A Seventeen Year Comparison”…
On December 11, 2018, the SEC announced settled chargesagainst a natural and organic food company, Hain Celestial Group.  The company’s problems began when members of the company’s finance group discovered that its sales organization had been offering unauthorized incentives to two major customers.  These incentives induced the customers to accept shipments near quarter-end that helped the sales department meet internal sales goals. When the finance department discovered these unauthorized practices they began an investigation…
In November and December 2018, SEC Chair Clayton, Chief Accountant Bricker and several other staff members discussed the use of S-X Rule 3-13 waivers.  These waivers may be appropriate when a mechanical application of rules like the significant subsidiary test yield results that may require costly disclosures that might not be material to investors.  All of the SEC speakers emphasized that such waivers require thorough analysis and are not automatic.  The SEC staff has processes…