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SEC Officials Discuss Disclosure Review Program

Written by Warren Averett on December 30, 2014

Warren Averett serves publicly traded companies, from accelerated filers to reporting public shells, across a broad range of industries. In an effort to continually keep our public company clients informed of the latest SEC and FASSB developments, our SEC Practice Group recently communicated the following information to our SEC registrant clients.

In a recent article from the PCAOB Reporter, John Filar Atwood reported on the matter of SEC Comment Letters.

“A company that receives a comment letter from the SEC should not assume that it is going to be required to rewrite its disclosure,” according to Shelley Parratt, deputy director in charge of disclosure operations at the SEC’s Division of Corporation Finance. “If a company feels that something does not belong in its disclosure, it should explain why and the staff will consider it,” she said.

Mark Kronforst, chief accountant in the Division of Corporate Finance, said that one of the key current developments from his perspective is the implementation of new guidelines from the Committee of Sponsoring Organizations (COSO). Kronforst went on to say that the staff will stop supporting the other framework at the end of the year. The staff issues many comments on taxes and contingencies, according to Kronforst.

Parratt said that in general the filings review program is intended to ensure that disclosure is clear and understandable. She said that the staff is not focused on correcting grammar, as some have suggested, unless is does not understand a sentence. The staff tries to tailor its comments to a specific company’s circumstances, she noted, and does not start the review process with the idea that it is going to focus on a particular aspect of an industry.

If you have questions about SEC comment letters or any other matters, contact your Warren Averett member, or any member of our SEC Practice Division at 813.229.2321.

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