The Securities and Exchange Commission adopted amendments to the accelerated filer and large accelerated filer definitions, which impact the Sarbanes-Oxley Act of 2002.
The amendments will:
- Exclude from the accelerated and large accelerated filer definitions an issuer that is eligible to be a smaller reporting company (SRC) and had annual revenues of less than $100 million in the most recent fiscal year for which audited financial statements are available. Business development companies will be excluded in analogous circumstances.
- Increase the transition thresholds for an accelerated and a large accelerated filer 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; and
- Add a check box to the cover pages of annual reports on Forms 10-K, 20-F, and 40-F to indicate whether an internal control over financial reporting (ICFR) auditor attestation is included in the filing.
SRCs with less than $100 million in revenues will continue to be required to establish and maintain effective ICFR, they will continue to be required to include CEO and CFO certifications, but SRCs will no longer be required to obtain a separate attestation of their ICFR from an outside auditor.
The amendments will become effective 30 days after publication in the Federal Register. The final amendments will apply to annual report filings due on or after the effective date.
The final rule may be accessed here.
A Legal Update will follow.