AccountingLink

    SEC

    Summary
    The Securities and Exchange Commission (SEC) is a federal agency which holds primary responsibility for enforcing the federal securities laws and regulating the securities industry, the nation's stock and options exchanges, and other electronic securities markets in the US.

    SEC in Focus
    Proposed rules
    EY comment letters
    Selected SEC speeches-Chairman and Commissioners
    Selected SEC staff speeches
    Selected news releases

    SEC in Focus

    5 October 2017

    SEC in Focus - October 2017
    Our latest newsletter summarizes SEC developments in the last quarter, including certain items we have not previously reported in Week in Review. Highlights include remarks from SEC Chairman Jay Clayton on cybersecurity disclosures in SEC filings, recent guidance on pay ratio disclosure requirements, regulatory relief for companies and individuals affected by recent hurricanes, staff clarifications about its nonpublic review program and recent trends in SEC staff comments on non-GAAP measures and other topics.

    6 July 2017

    SEC in Focus - July 2017
    Our latest newsletter summarizes SEC developments in the last quarter, including certain items we have not previously reported in Week in Review. Highlights include remarks from SEC Chief Accountant Wesley Bricker on the adoption of significant new accounting standards and recent trends in SEC staff comments on non-GAAP measures.

    6 April 2017

    SEC in Focus - April 2017
    Our latest newsletter summarizes SEC developments in the last quarter, including certain items we have not previously reported in Week in Review. This issue highlights Jay Clayton’s testimony at his Senate Banking Committee confirmation hearing, the push to ease SEC rules required by the Dodd-Frank Act, recent trends in SEC staff comments, SEC Chief Accountant Wesley Bricker’s remarks on increasing the effectiveness of audit committees and final rules, rulemaking proposals, SEC staff guidance and other SEC activities.

    12 January 2017

    SEC in Focus - January 2017
    Our latest newsletter summarizes SEC developments in the last quarter, including certain items we have not previously reported in Week in Review. This issue highlights the remarks made by SEC staff members at the recent AICPA National Conference on Current SEC and PCAOB Developments related to SEC reporting implications of new accounting standards, non-GAAP financial measures and management’s discussions and analysis disclosure considerations for income taxes. We also discuss the SEC's progress on rulemaking and other initiatives, as well as significant personnel changes.

    6 October 2016

    SEC in Focus - October 2016
    Our latest newsletter summarizes developments related to SEC matters, including certain items we have not previously reported in Week in Review. This issue highlights the SEC staff’s continued focus on non-GAAP financial measures and recent developments in the SEC’s disclosure effectiveness project, recent enforcement activities and current trends in the SEC staff comment letters. We discuss the SEC's progress on rulemaking and other initiatives, including the changes in the accredited investor definition recommended by the SEC Advisory Committee on Small and Emerging Companies.

    7 July 2016

    SEC in Focus - July 2016
    Our latest newsletter summarizes developments related to SEC matters, including certain items we have not previously reported in Week in Review. This issue highlights the SEC staff’s continued focus on non-GAAP financial measures and disclosure effectiveness, recent enforcement activities and developments in XBRL. We discuss the SEC's progress on rulemaking and other initiatives, including final rules on payments by resource extraction issuers and proposed changes to the definition of a smaller reporting company.

    7 April 2016

    SEC in Focus - April 2016
    Our latest newsletter summarizes developments related to SEC matters, including certain items we have not previously reported in Week in Review. This issue highlights the progress on the nominations of the two SEC commissioner candidates, the SEC staff’s continued focus on both non-GAAP financial measures and disclosure effectiveness, recent enforcement activities and developments in XBRL. We discuss the SEC's progress on rulemaking and other initiatives, including new amendments to the JOBS Act that allow companies to take advantage of additional accommodations during the IPO process. We also discuss a proposed rule for broker-dealers in liquidation proceedings, a final rule for security-based swap dealers and proposed changes to NYSE and NASDAQ listing standards.

    7 January 2016

    SEC in Focus - January 2016
    Our latest newsletter summarizes SEC developments in the last quarter, including certain items we have not previously reported in Week in Review. This issue highlights the remarks of the SEC’s Chair and staff at the AICPA National Conference on Current SEC and PCAOB Developments related to internal control over financial reporting, segment reporting and the new revenue recognition standard. We also discuss the SEC's progress on rulemaking and other initiatives, including final rules on crowdfunding and changes to SEC rules affecting emerging growth companies resulting from recent legislation, and developments in the SEC’s disclosure effectiveness initiative.

    Proposed rules

    11 October 2017

    FAST Act modernization and simplification of Regulation S-K
    These proposed amendments are based on the recommendations made in the staff’s Report on Modernization and Simplification of Regulation S-K, as required by Section 72003 of the Fixing America’s Surface Transportation Act. The proposed amendments are intended to modernize and simplify certain disclosure requirements in Regulation S-K, and related rules and forms, in a manner that reduces the costs and burdens on registrants while continuing to provide all material information to investors. The amendments are also intended to improve the readability and navigability of disclosure documents and discourage repetition and disclosure of immaterial information. To provide for a consistent set of rules to govern incorporation by reference and hyperlinking, we are also proposing parallel amendments to several rules and forms applicable to investment companies and investment advisers, including proposed amendments that would require certain investment company filings to be submitted in HyperText Markup Language (“HTML”) format.

    1 March 2017

    Inline XBRL filing of tagged data
    The SEC proposed a rule that would require operating companies and mutual funds to use Inline XBRL and embed tags in their financial statements and their risk/return summaries, respectively. The proposal would require Inline XBRL tagging on the same information operating companies and mutual funds currently include in separate XBRL exhibits. The requirement would be phased in over three years for operating companies based on filing status and over two years for mutual funds based on net assets. Comments are due 60 days after the proposal is published in the Federal Register.

    26 October 2016

    Universal proxy
    The SEC proposed requiring the use of a universal proxy ballot listing the names of all board of director nominees, regardless of whether they are nominated by the company or a dissident shareholder. The proposed rule would allow shareholders voting by proxy to use a single ballot to vote for any combination of candidates nominated by either the company or dissident shareholders. Comments are due 60 days after publication in the Federal Register.

    31 August 2016

    Exhibit hyperlinks and HTML format
    The SEC proposed rule and form amendments that would require registrants to include a hyperlink to exhibits in their filings. The proposed amendments would require registrants that file registration statements and periodic and current reports that are subject to the exhibit requirements under Item 601 of Regulation S-K, or that file on Forms F-10 or 20-F, to include a hyperlink to each exhibit listed in the exhibit index of the filings. The amendments would also require that registrants submit all of these filings in HyperText Markup Language (HTML) format.

    27 June 2016

    Amendments to smaller reporting company definition
    The SEC proposed a rule that would allow more companies to qualify as smaller reporting companies (SRCs) if they have public float of less than $250 million (up from $75 million) or revenue of less than $100 million in the previous year (up from $50 million) if they have no public float. The SEC said the proposed rule would promote capital formation by allowing more companies to make scaled disclosures. The proposal would not increase the $75 million public float threshold in the definition of an accelerated filer, meaning that companies could qualify as SRCs under the proposed rule but still be subject to the reporting deadlines for accelerated filers, as well as auditor attestation to ICFR under Section 404(b) Sarbanes-Oxley Act. Comments are due 60 days after publication in the Federal Register.

    16 June 2016

    Modernization of property disclosures for mining registrants
    The SEC has proposed rules to modernize the disclosure requirements for mining properties by aligning them with current industry and global regulatory practices and standards. The proposed revisions would update disclosure requirements for mining registrants in Item 102 of Regulation S-K under the Securities Act of 1933 and the Securities Exchange Act of 1934 and related guidance in Industry Guide 7. The proposed rules would modernize the Commission’s disclosure requirements by aligning them with global standards and give investors more comprehensive information of a registrant’s mining properties that they can use to make informed investment decisions.

    16 May 2016

    Incentive-based compensation arrangements
    Six federal agencies are inviting public comment on a proposed rule to prohibit incentive-based compensation arrangements that encourage inappropriate risks at covered financial institutions. The proposed rules would apply to covered financial institutions with total assets of $1 billion or more. The requirements are tailored based on assets, and covered institutions would be divided into three categories. The deadline for comments on the proposed rule, which was submitted for publication in the Federal Register, is 22 July 2016.

    22 December 2015

    Transfer agent regulations
    The SEC issued an advanced notice of proposed rulemaking (ANPR) for new requirements for transfer agents, together with a concept release requesting public comment on the Commission’s broader review of transfer agent regulation. The ANPR and concept release provide a summary of the history of the national clearance and settlement system, the role of transfer agents within that system, and the origins and current status of the Commission’s transfer agent rules.

    11 December 2015

    Disclosure of payments by resource extraction issuers
    The SEC is proposing rules that would require resource extraction issuers to disclose payments made to the U.S. federal government or foreign governments for the commercial development of oil, natural gas or minerals. The proposed rules, mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act, are intended to further the statutory objective to advance U.S. policy interests by promoting greater transparency about payments related to resource extraction. Under the proposed rules, an issuer would be required to disclose payments made to the U.S. federal government or a foreign government if the issuer is required to file annual reports with the Commission under the Securities Exchange Act. The issuer would also be required to disclose payments made by a subsidiary or entity controlled by the issuer. Comments are due by 25 January 2016.

    11 December 2015

    Establishing the form and manner with which security-based swap data repositories must make security-based swap data available to the commission
    The SEC is proposing an amendment to specify the form and manner with which security-based swap data repositories (SDRs) will be required to make security-based swap data available to the Commission under Exchange Act Rule 13n-4(b)(5). The Commission is proposing to require SDRs to make these data available according to schemas that will be published on the Commission’s website and that will reference the international industry standards Financial products Markup Language (FpML) and Financial Information eXchange Markup Language (FIXML).

    11 December 2015

    Use of derivatives by registered investment companies and business development companies
    The SEC is proposing a new rule designed to enhance the regulation of the use of derivatives by registered investment companies, including mutual funds, exchange-traded funds (ETFs) and closed-end funds, as well as business development companies. The proposed rule would limit funds’ use of derivatives and require them to put risk management measures in place which would result in better investor protections.

    1 July 2015

    Possible revisions to audit committee disclosures
    The SEC issued this concept release to seek comments regarding audit committee reporting requirements, with a focus on the audit committee’s reporting of its responsibilities with respect to its oversight of the independent auditor.

    EY comment letters

    24 May 2017

    Comment Letter - SEC’s initiative to modernize Guide 3 disclosure requirements
    In our comment letter, we supported the Commission’s initiative to remove redundant or obsolete disclosure requirements and modernize Industry Guide 3: Statistical Disclosure by Bank Holding Companies. We also articulated concerns over the potential incorporation by reference in SEC filings of disclosures that bank holding companies currently provide under banking sector regulations.

    16 May 2017

    Comment Letter - SEC’s Inline XBRL proposal
    In our comment letter, we supported the objective of requiring structured data and data tagging to improve disclosure analysis and help investors and other market participants make more-informed decisions. However, we expressed concerns about requiring the use of Inline XBRL and suggested other actions that could be taken to improve the quality and reliability of financial statement data tagging. We noted that embedding tags in the financial statements could lead investors to assume such tags have been audited or reviewed and suggested ways to alleviate any expectation gap if the SEC moves forward with the proposal.

    19 January 2017

    Comment letter - SEC’s annual review under the Regulatory Flexibility Act
    In our comment letter, we recommend that the Commission consider making the periodic review required by the Regulatory Flexibility Act more transparent and more robust to encourage broader and meaningful participation by constituents. We believe an effective post-implementation review process should determine whether a rule has accomplished its objective, evaluate the compliance cost for all issuers and the benefits for investors and provide feedback to inform and improve the rulemaking process.

    30 November 2016

    Comment Letter - SEC’s request for input on Subpart 400 of Regulation S-K
    In our comment letter, we recommended the Commission consider reducing the current complexity around the timing of executive compensation disclosures in securities offerings and encourage a private sector initiative to develop guidance on the computation and disclosure of supplemental compensation metrics such as compensation “realizable” and “realized.” We also recommended that the Commission consider ways to enhance disclosures about diversity on public company boards and reconsider the definition of an audit committee financial expert.

    31 October 2016

    Comment Letter - SEC proposal requiring exhibit hyperlinks
    In our comment letter, we support the SEC proposal to require registrants to include a hyperlink to each exhibit listed in the exhibit index of nearly all filings subject to Item 601 of Regulation S-K. We also reiterate our recommendation that the SEC adopt a company profile approach for organizing and presenting exhibits, other reference information, and information with respect to specific fiscal periods. We believe that approach ultimately will be a more effective way to provide access to corporate exhibits.

    31 October 2016

    Comment Letter - SEC proposal to eliminate redundant and outdated disclosures
    In our comment letter, we supported substantially all of the SEC’s proposals to eliminate disclosure requirements that have become redundant or outdated due to subsequent FASB standard setting or SEC rulemaking. We also recommended that the Commission consider rescinding a number of additional disclosure rules that, in our view, are duplicative or inconsistent with current US GAAP disclosure requirements.

    8 September 2016

    Comment letter - SEC’s proposed amendment to the definition of smaller reporting company
    In our comment letter, we offered a view on how the Commission should approach any potential changes to its accelerated filer definition. We also recommended conforming Rule 3 05 of Regulation S X with the proposed $100 million revenue limit for smaller reporting companies (i.e., require no more than two years of audited financial statements when an acquired business has annual revenue below $100 million).

    21 July 2016

    Comment Letter - Regulation S-K concept release
    In our comment letter, we recommend the SEC move to a disclosure framework that articulates clear disclosure objectives and allows registrants to more effectively communicate material information to investors. We ask the SEC to consider enhancements to various business and financial disclosures, including those related to the description of the business, risk factors and management’s discussion and analysis. We also suggest that the SEC explore ways to improve the presentation and delivery of information through a company profile approach.

    30 March 2016

    Comment Letter - SEC’s proposal to regulate funds’ use of derivatives
    In our comment letter, we say closed-end funds that rely on the proposed exemption for derivatives and financial commitment transactions should not be required to reflect these instruments as senior securities in their senior securities table disclosures or as components of the calculations from which these disclosures are derived, and we recommend that the SEC provide guidance on this point. We also recommend that the SEC consider eliminating the requirement that the senior securities table be audited. Finally, we recommend that, if the SEC decides not to rescind the audit requirement, the SEC should clarify that an auditor’s responsibility regarding the senior securities table does not extend to evaluating a closed-end fund’s compliance with the provisions of proposed Rule 18f-4.

    22 February 2016

    Comment Letter - SEC rules implementing provisions of the FAST Act
    In our comment letter, we suggested that the SEC allow forward incorporation by reference of Exchange Act reports into Form S-1 by all registrants, not just smaller reporting companies as provided by the interim final rules adopted by the SEC in January. We also recommended that the SEC remove the Form S-1 and F-1 requirement for a registrant to be “seasoned” (i.e., file its first annual report) to be eligible to incorporate by reference. In addition, we suggested that the SEC allow an EGC to omit interim financial statements (and related pro forma information, MD&A and selected financial data) from its initial IPO filing or submission if they will not be required at effectiveness.

    14 January 2016

    Comment Letter - SEC’s fund liquidity and swing pricing proposal
    In our comment letter, we recommend that the SEC clarify how mutual funds that would be allowed to use swing pricing (i.e., adjust net asset value per share (NAV) for costs associated with satisfying requests for shareholder purchases and redemptions that exceed certain thresholds) would present NAV on the balance sheet and certain financial highlights and how they would adjust NAV for trade date activity, among other things. We also express our view that auditors should not be responsible for assessing the reasonableness of a fund’s swing pricing policies and procedures and recommend that the SEC clarify that point in any adopting release.

    20 November 2015

    Comment Letter - Regulation S-X requirements for other entities
    In our comment letter, we responded to the SEC’s request for feedback on requirements that registrants disclose information about other entities (e.g., acquired businesses, equity method investees and subsidiary issuers and guarantors) and said the rules are complex and require disclosures that are not as useful as they could be. We recommended simplifying the significance tests, enhancing pro forma financial information and expanding the use of abbreviated financial statements and summarized financial information to reduce the compliance costs while still providing investors with material information. We encourage others to submit comments and believe the SEC will accept and consider them after the official comment period closes on 30 November 2015.

    20 November 2015

    Comment letter - Regulation S-X requirements for registrant’s financial statements
    In our comment letter, we encouraged the SEC to streamline annual and quarterly reporting requirements, eliminate inconsistencies between the disclosure requirements of the Securities Act of 1933 and Exchange Act of 1934 and coordinate with the FASB to eliminate duplicative disclosure requirements.

    Selected SEC speeches-Chairman and Commissioners

    27 June 2016

    Speech by Chair Mary Jo White at the International Corporate Governance Network annual conference
    SEC Chair Mary Jo White gave the keynote address at the International Corporate Governance Network annual conference entitled, "Focusing the lens of disclosure to set the path forward on board diversity, non-GAAP, and sustainability."

    19 February 2016

    Remarks by Chair Mary Jo White at the 2016 SEC Speaks conference
    SEC Chair Mary Jo White, made remarks at the "SEC Speaks" conference in Washington D.C. entitled, Beyond Disclosure at the SEC in 2016.

    9 December 2015

    Chair Mary Jo White keynote address at the AICPA National Conference
    Chair Mary Jo White gave the keynote address at the AICPA National Conference entitled, "Maintaining high-quality, reliable financial reporting: a shared and weighty responsibility."

    Selected SEC staff speeches

    21 September 2017

    Deputy Chief Accountant Sagar Teotia remarks before the San Diego Chapter of the Financial Executives Institute
    Deputy Chief Accountant Sagar Teotia remarks, “Addressing Implementation Matters to Improve Financial Reporting."

    9 June 2017

    Chief Accountant Wesley R. Bricker makes keynote address before the 2017 Journal of Accounting and Public Policy Conference
    Chief Accountant Wesley R. Bricker gave a keynote address, “The Interaction between Regulatory Institutions and Accounting: A Public Policy Perspective”.

    28 June 2016

    Speech by SEC Chief of Staff Andrew Donohue at the InvestoRegulation Conference in London
    SEC Chief of Staff Andrew Donohue gave the keynote address at the InvestoRegulation Conference in London entitled, "The SEC at home and abroad."

    9 December 2015

    Remarks of James V. Schnurr before the 2015 AICPA National Conference
    James V. Schnurr the Chief Accountant of the Office of the Chief Accountant remarks before the 2015 AICPA National Conference.

    Selected news releases

    21 September 2017

    SEC adopts interpretive guidance on pay ratio rule
    The SEC has approved interpretive guidance to assist companies in their efforts to comply with the pay ratio disclosure requirement mandated by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. Under the Commission’s rule implementing the pay ratio requirement, companies are required to begin making pay ratio disclosures in early 2018.

    18 August 2017

    Commission and commission staff issue updates to interpretive guidance on revenue recognition
    The SEC issued two releases and the SEC staff released a Staff Accounting Bulletin to update interpretive guidance regarding revenue recognition.

    12 January 2017

    SEC announces 2017 examination priorities
    The SEC announced its Office of Compliance Inspections and Examinations’ 2017 priorities. Areas of focus include electronic investment advice, money market funds, and financial exploitation of senior investors. The priorities also reflect a continuing focus on protecting retail investors, including individuals investing for their retirement, and assessing market-wide risks. The 2017 examination priorities address issues across a variety of financial institutions, including investment advisers, investment companies, broker-dealers, transfer agents, clearing agencies, private fund advisers, national securities exchanges, and municipal advisors.

    25 August 2016

    SEC seeks public comment on disclosure requirements relating to management, security holders and corporate governance matters
    The SEC is seeking public comment on how to enhance disclosures on executive compensation, beneficial security holders, related parties and other corporate governance and independence matters addressed in Subpart 400 of Regulation S-K. This request for comment is part of its disclosure effectiveness initiative and is mandated by the Fixing America’s Surface Transportation Act. Comments are due 60 days after publication in the Federal Register.

    1 June 2016

    SEC adopts amendment to Form 10-K implementing FAST Act provision
    The SEC announced it has approved an interim final rule that allows Form 10-K filers to provide a summary of business and financial information contained in the annual report. The rule implements a provision of the Fixing America’s Surface Transportation (FAST) Act. The interim final rule provides filers with flexibility in preparing the summary and those opting to provide it must include hyperlinks to the related, more detailed disclosure in the Form 10-K.

    3 May 2016

    SEC adopts amendments to implement JOBS Act and FAST Act changes for Exchange Act registration requirements
    The SEC has approved amendments to revise the rules related to the thresholds for registration, termination of registration, and suspension of reporting under Section 12(g) of the Securities Exchange Act of 1934. These amendments implement provisions of the JOBS Act and the FAST Act. With the adoption of these amendments, the Commission has completed all of the rulemaking mandated under the JOBS Act.

    11 January 2016

    SEC announces 2016 examination priorities
    The SEC announced its Office of Compliance Inspections and Examinations’ 2016 priorities. New areas of focus include liquidity controls, public pension advisers, product promotion, and two popular investment products – exchange-traded funds and variable annuities. The priorities also reflect a continuing focus on protecting investors in ongoing risk areas such as cybersecurity, microcap fraud, fee selection, and reverse churning.

    28 December 2015

    SEC issues annual staff reports on credit rating agencies - December 2015
    The SEC issued its two annual staff reports on credit rating agencies registered as nationally recognized statistical rating organizations (NRSROs). The reports show that NRSROs have made operational improvements and have enhanced process accountability, controls and governance, and that smaller NRSROs have made competitive inroads in certain rating categories.

    18 December 2015

    SEC issues staff report on accredited investor definition
    The SEC issued a staff report on the accredited investor definition. The Dodd-Frank Wall Street Reform and Consumer Protection Act directs the Commission to review the accredited investor definition as it relates to natural persons every four years to determine whether the definition should be modified or adjusted. Staff from the Divisions of Corporation Finance and Economic and Risk Analysis prepared the report in connection with the first review of the definition. The Commission is inviting members of the public to provide comments on the accredited investor definition, generally, and specifically on the staff recommendations contained in the report.