On September 16, 2024, CorpFin updated its FAQs for companies that submit draft registration statements for nonpublic review. The JOBS Act provided this nonpublic review process for Emerging Growth Companies, and in 2017 CorpFin announced it would provide a nonpublic review option for many other companies. The current update to the related FAQs makes a
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A Regulation FD Double Down – DraftKings
Back in April 2013, the SEC issued a Report of Investigation addressing dissemination of information via social media channels. The report focused on a Netflix CEO’s use of social media to disclose information relevant to investors without previously telling investors that information would be released via social media. In the report the SEC announced that…
Insider Transaction and Beneficial Ownership Reporting – An Enforcement Reminder
On September 25, 2024, the Enforcement Division announced settled actions against 23 companies and individuals relating to Section 16 and Section 13 reporting. The various actions involved:
Failure of individuals to file Section 16 reports;
Failure of companies to report delinquent Section 16 reports; and
Failure of companies to file Forms 13D, 13G, 13F, and…
Still an Enforcement Focus – More Attempts to Limit Whistleblower Protections
On September 9, 2024, the SEC announced settled charges against seven companies for attempting to limit whistleblower rights through provisions in employment, separation and other agreements. As you can read in the SEC’s Press Release and the related Orders, one company tried to force employees to waive their right to whistleblower awards such as those…
A “Green” Enforcement Action
On September 10, 2024, the SEC announced a settled enforcement action against Keurig Dr Pepper, Inc. related to statements the company made in its 2019 and 2020 Form 10-Ks about the recyclability of its K-Cup coffee and tea pods. In Item 1 of the company’s Form 10-K for the year ended December 31, 2020, the…
FASB’s Conceptual Framework and a Related Chief Accountant Statement
On July 12, 2024, the FASB issued the final chapter of its Conceptual Framework, finishing a process that has spanned decades. The Conceptual Framework does not establish authoritative guidance. In fact, all references to the Conceptual Framework were removed from the Codification in ASU 2024-02. That said, the Conceptual Framework is a foundational part of…
ICFR Reporting and Acquisitions
In the year a company completes an acquisition, ICFR reporting for the combined business can be problematic. If the acquired company has been private, or has not built an ICFR evaluation process, it may not be practicable to include the acquired business in the acquiror’s assessment of ICFR, and, if applicable, in the auditor’s attestation…
Cybersecurity Event Disclosures – New C&DIs and an Announcement Addressing Selective Disclosure Concerns
On June 24, 2024, CorpFin issued five new C&DIs addressing cybersecurity incident reporting on Form 8-K Item 1.05. The C&DIs focus on situations where a company has experienced an attack such as a ransomware attack. For example, C&DI 104B.05 states that if a company experiences an attack and makes a ransomware payment before a materiality…
inSecurities Podcast Explores Recent U.S. Supreme Court Decisions
Recent U.S Supreme Court decisions have addressed how the SEC can use its administrative court processes for fraud cases and ended the Chevron doctrine, which had created a presumption that courts must rely on an agency’s interpretations of ambiguous statutes. In this episode of the inSecurities podcast, hosts Chris Ekimoff and Kurt Wolfe provide…
Loops Do Close
Several years ago, on May 3, 2021, the SEC announced a settled enforcement action against Under Armour, Inc. The starting point for this case was a 23% stock price drop when Under Armour disclosed that their revenue growth rate, historically over 20%, had fallen to 12% for the fourth quarter of 2016. According to the…