As we enter the heart of Form 10-Q review season for calendar year-end companies and look ahead to Form 10-K review season early next year, a recent decision in a securities fraud class action suit reinforces the need to carefully review litigation disclosure in annual and quarterly reports and registration statements. Members of our Public
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SEC Disclosure Considerations Arising From the Israel-Hamas War
Registrants may have disclosure obligations under the federal securities laws related to the direct or indirect impact of Israel’s declaration of war on Hamas, a U.S. designated Foreign Terrorist Organization, and current armed conflict in Israel and the Gaza Strip (the “War”). Companies that have direct or indirect business operations, interests or investments in the…
“Emerging Growth Company” Transition and Compliance After Loss of Status
An emerging growth company (EGC) is a type of issuer that can follow relaxed disclosure and gun-jumping regulations when it files with the SEC to go public. This status was created by the JOBS Act of 2012 to help smaller companies access public markets. To qualify as an EGC, a company must have total annual…
FAQs on New Executive Incentive Compensation Clawback Rules
On October 26, 2022, the U.S. Securities and Exchange Commission (the “SEC”) adopted regulations implementing Section 10D of the Securities Exchange Act of 1934 (the “Exchange Act”), which was added by the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd Frank”). The SEC originally proposed these rules in 2015, and reopened the…
SEC’s Division of Corporation Finance “Sample Letter to Companies Regarding Their XBRL Disclosures”
On September 7, 2023, the staff of the Division of Corporation Finance (the “Division”) of the Securities and Exchange Commission (the “SEC” or “Commission”) published a sample comment letter (known as a “Dear Issuer” letter) to companies regarding their eXtensible Business Reporting Language (XBRL, which for purposes of this Update includes Inline XBRL) disclosures. The…
Recent SEC’s Enforcement Actions Highlight Continued Focus on Late Filing Disclosures
On August 22, 2023, the Securities and Exchange Commission (the “SEC”) announced that it had instituted and settled proceedings against five public companies for failing to disclose in Form 12b-25 that their request for seeking a delayed quarterly or annual reporting filing was caused by an anticipated restatement or correction of prior financial reporting. See…
SEC Announces First Fee Rate Advisory for Fiscal Year 2024
On August 25, 2023, the SEC announced a significant increase in the fees that public companies and other issuers are required to pay to register their securities from $110.20 per million dollars to $147.60 per million dollars. The new fee rate is effective October 1, 2023 and is applicable to the registration of securities under…
Additional Disclosure and Interpretive Guidance from the SEC’s Division of Corporation Finance on Insider Trading Arrangements and Policies
On August 25, 2023, the Division of Corporation Finance of the Securities and Exchange Commission issued additional interpretive guidance on Rule 10b5-1 trading plan requirements.
Our Public Company Advisory Practice prepared this Additional SEC Staff Guidance on Insider Trading Arrangements and Policies to summarize the guidance.
The post Additional Disclosure and Interpretive Guidance from the…
Public Company Stockholder Meeting Adjournment Proposals
Our Public Company Advisory Practice has been seeing an increase in situations where clients are having difficulty reaching a quorum for an annual or special meeting or in securing enough votes to pass a proposal. Some of this difficulty can be traced to the decision by a number of brokerage firms to refrain from exercising…
Form 10-Q Risk Factor Updates: Better Practices for Companies that Restate Risk Factors
Should companies that restate the entire Risk Factors section from the most recent Form 10-K report when they update the risk factor disclosure in their Form 10-Q reports to reflect material changes in that disclosure do anything to identify the changes? Although not specifically required, we believe that identifying material changes in risk factor disclosure…