This Thursday, the Securities and Exchange Commission will hold an open meeting to consider, among other things, proposed amendments to the definition of “smaller reporting company” (SRC), as well as proposed amendments to rules and forms requiring the use of Inline XBRL. See the notice of open meeting along with the webcast information here.
In June 2016, the Commission had proposed amendments to the SRC definition in order to expand the number of companies that qualify as SRCs and are able to benefit from scaled disclosures. Currently, SRCs are registrants, other than asset-backed issuers, investment companies, and majority-owned subsidiaries of non-SRC parent companies, with less than $75 million in public float as of the last business day of their most recently completed second fiscal quarter or a public float of zero and annual revenues of less than $50 million during the most recently completed fiscal year for which audited financial statements are available. SRCs are eligible for a number of disclosure accommodations under Regulation S-K and Regulation S-X. Under the proposed amendments from 2016, registrants with a public float of less than $250 million would qualify as SRCs. A registrant would assess its status by calculating its public float as of the last business day of its most recently completed second fiscal quarter. The proposed amendments from 2016 were viewed favorably by commenters. In recent statements by representatives from the Commission, there have been some statements that suggest that the proposed amendments to be considered by the Commission also will address the requirements under Section 404 of the Sarbanes-Oxley Act regarding auditor attestation.