The Securities and Exchange Commission proposed amendments to the accelerated filer and large accelerated filer definitions, which have been highly anticipated. As noted in prior blog posts, at the time that the SEC adopted amended definitions of smaller reporting company, market participants had expected that the SEC would address the thresholds that trigger a requirement for auditor attestation. If the proposed amendments were to be adopted, smaller reporting companies with less than $100 million in revenues would not be required to obtain an attestation of their internal control over financial reporting (ICFR) from an independent outside auditor. The proposed amendments to Exchange Act Rule 12b-2 that would revise the “accelerated filer” and “large accelerated filer” definitions. The proposed amendments would:
- Exclude from the accelerated and large accelerated filer definitions an issuer that is eligible to be an SRC and had no revenues or annual revenues of less than $100 million in the most recent fiscal year for which audited financial statements are available
- Increase the transition thresholds for accelerated and large accelerated filers becoming a non-accelerated filer from $50 million to $60 million and for exiting large accelerated filer status from $500 million to $560 million
- Add a revenue test to the transition thresholds for exiting both accelerated and large accelerated filer status
The approach of adding a revenue test is consistent with legislation that has been proposed in various recent sessions of Congress.
A Legal Update will follow shortly.