Division of Corporation Finance

On November 23, the Division of Corporation Finance (the Division) of the Securities and Exchange Commission issued CF Disclosure Guidance: Topic No. 10 (the Guidance), providing the Division’s views regarding disclosure considerations for companies based in or with the majority of their operations in the People’s Republic of China (referred to as “China-based” companies).
Continue Reading Division of Corporation Finance Issues Disclosure Consideration for China-Based Issuers

On November 18, the Division of Corporation Finance (Division) of the Securities and Exchange Commission released updates to the Division’s Financial Reporting Manual. The Financial Reporting Manual is a key source of the Division’s informal accounting guidance and has been updated with changes through October 30.
Continue Reading SEC Division of Corporation Finance Releases Financial Reporting Manual Updates

On September 21, the Division of Corporation Finance of the Securities and Exchange Commission issued a new Compliance and Disclosure Interpretation (C&DI) addressing, and limiting, the ability of shell companies, including special purpose acquisition companies (SPACs), to use Form S-3 during the 12 months following a business combination.
Continue Reading SEC Issues C&DI on Use of Form S-3 by SPACs

On September 21, the Division of Corporation Finance of the Securities and Exchange Commission issued a new Compliance and Disclosure Interpretation (C&DI) regarding the treatment of benefits provided to executive officers in light of the COVID-19 pandemic and whether such benefits constitute perquisites or personal benefits that must be disclosed in a registrant’s summary compensation table and included when determining the registrant’s three most highly compensated officers (other than the registrant’s principal executive officer and principal financial officer) for identifying the “named executive officers.”
Continue Reading SEC Issues C&DI on COVID-19 Related Benefits

On June 23, the Division of Corporation Finance (the Division) of the Securities and Exchange Commission issued CF Disclosure Guidance: Topic No. 9A (Topic 9A) providing additional disclosure considerations for public reporting companies regarding operations, liquidity and capital resources disclosures in light of business and market disruptions related to the COVID-19 pandemic. Topic 9A supplements CF Disclosure Guidance Topic No. 9 issued by the Division on March 25, 2020 and discussed in Katten’s advisory “COVID-19 Impact on Public Disclosure on SEC Reporting Companies.”
Continue Reading SEC Division of Corporation Finance Issues Additional Disclosure Guidance Related to COVID-19 Pandemic

On March 24, the Securities and Exchange Commission, on behalf of the staffs of the Division of Corporation Finance, the Division of Investment Management and the Division of Trading and Markets issued an announcement with respect to the authentication document retention requirements of Rule 302(b) of Regulation S-T in light of health, transportation and other logistical issues raised by the spread of COVID-19. Rule 302(b) requires that each signatory manually sign a signature page or other document authenticating his or her signature that appears in typed form within the electronic filing with the SEC.
Continue Reading SEC Staff Issues Statement Regarding Authentication Documentation Retention Requirements in Light of COVID-19 Concerns

As previously discussed in the April 12, 2019 edition of Corporate & Financial Weekly Digest, the Securities and Exchange Commission adopted final rules on March 20, 2019, that allow registrants to omit a discussion and analysis of the earliest of the three years of required financial statements from the Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) section of their annual reports. Omitting that section from the annual reports filing with the SEC is permissible so long as the discussion of such year is already included in an earlier SEC filing and the registrant includes a statement identifying the location of such discussion in the prior filing. On January 24, the staff of the SEC’s Division of Corporation Finance (the Staff) issued three Compliance and Disclosure Interpretations (C&DIs) to address questions related to the final rule.
Continue Reading SEC Division of Corporation Finance Issues C&DIs on Omission of Third Year From MD&A

On October 16, the staff of the Division of Corporation Finance (Staff) of the Securities and Exchange Commission issued Staff Legal Bulletin No. 14K (SLB). The SLB provides new guidance regarding the Staff’s views as to when registrants may properly exclude, pursuant to Rule 14a-8(i)(7) of the Securities Exchange Act of 1934, as amended, shareholder proposals under the “ordinary business” exception.
Continue Reading SEC Issues Legal Bulletin Regarding Shareholder Proposals Exclusion

On August 20, the staff of the Division of Corporation Finance (the staff) of the Securities and Exchange Commission released several new Compliance and Disclosure Interpretations (C&DIs) relating to interactive data/eXtensible Business Reporting Language (XBRL), with a focus on items relating to Inline XBRL format requirements.
Continue Reading SEC Division of Corporation Finance Issues C&DIs Regarding Inline XBRL