US reporting companies that are planning or have completed a significant acquisition of a business may need to file separate target financial statements and related pro forma financial statements under Rule 3-05 and Article 11 of Regulation S-X. The specific SEC rules and financial reporting obligations triggered by a significant acquisition can be quite complex
Ryan Castillo
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Top 10 Practice Tips: Comfort Letters
By Anna T. Pinedo & Ryan Castillo on
A comfort letter is a letter delivered by an issuer’s independent accountants to the underwriters or initial purchasers that provides certain assurances with respect to financial information included in a registration statement, prospectus or offering memorandum used for a securities offering. Underwriting agreements and purchase agreements typically require the delivery of one or more comfort…
Bill Requires Certain Issuers to Disclose to the SEC Information Regarding Foreign Jurisdictions that Prevent or Impair PCAOB Audit Inspections
By Ryan Castillo on
On December 10, 2018, Representative K. Michael Conway introduced H.R. 7234, a new bill entitled “Holding Foreign Companies Accountable Act” that seeks to amend the Sarbanes-Oxley Act of 2002. The bill requires each “covered issuer” to disclose annually to the SEC the (1) provisions of laws or rules in foreign jurisdictions that prevent the PCAOB…
SEC Proposes Amendments to Financial Statement Disclosure Requirements in Rules 3-10 and 3-16 of Regulation S-X
By Ryan Castillo on
Posted in Disclosure Requirements, SEC News
On July 24, 2018, the Securities and Exchange Commission (SEC) proposed amendments to the financial disclosure requirements in Rules 3-10 and 3-16 of Regulation S-X, in an effort to simplify and streamline disclosures by registrants in registered debt offerings with respect to guaranteed or collateralized debt securities. Rule 3-10 addresses the financial disclosure requirements for…
Center for Audit Quality Issues Non-GAAP Roadmap for Audit Committees
By Ryan Castillo on
Posted in Disclosure Requirements, Financial Reporting
The Center for Audit Quality (CAQ) recently published “Non-GAAP Measures: A Roadmap for Audit Committees” (CAQ Roadmap), which examines themes that emerged from a series of 2017 roundtables hosted by CAQ with various stakeholders. The CAQ publication notes that audit committees have an important responsibility to oversee the financial reporting process and external…
SEC Staff Updates Guidance on Non-GAAP Financial Measures Relating to Use of Financial Forecasts in Business Combinations
By Ryan Castillo on
On April 4, 2018, the staff of the SEC’s Division of Corporation Finance (Staff) updated its Compliance & Disclosure Interpretations on the use of non-GAAP financial measures (C&DIs), by issuing two new C&DIs (C&DI 101.02 and C&DI 101.03). These new C&DIs provide that, under certain conditions, financial measures included in forecasts used in business combination…