SEC makes nonpublic review process for draft IPOs and initial registration statements available to all companies
This issue has been revised to reflect an update to the June 29, 2017, announcement by the SEC’s Division of Corporation Finance (the "Division”) regarding its extension to all companies benefits that are similar to those offered to emerging growth companies (EGCs) regarding the confidential review of draft registration statements.
|The update clarifies a company’s eligibility for benefits and discusses transition considerations under the expanded nonpublic review process.
The Heads Up has also been revised to discuss the Division’s issuance of two new compliance and disclosure interpretations (C&DIs) on Securities Act forms (Questions 101.04 and 101.05) and an updated C&DI on the Fixing America’s Surface Transportation (FAST) Act (Question 1). The C&DIs address questions related to omitting, from draft registration statements, interim and annual financial information that a company reasonably believes will not need to be presented separately at the time its registration statement is filed publicly or, for emerging growth companies (EGCs), at the time of the offering.
On August 17, 2017, the Division updated its June 29, 2017, announcement (the “Announcement”) that the SEC would, as of July 10, 2017, be extending to all companies benefits that are similar to those offered to EGCs regarding the confidential review of draft registration statements under the Jumpstart Our Business Startups (JOBS) Act. The Announcement reflects statements by SEC Chairman Jay Clayton that enhancing capital formation is one of the Commission’s top priorities. The Division also released a companion series of frequently asked questions (FAQs).
|“By expanding a popular JOBS Act benefit to all companies, we hope that the next American success story will look to our public markets when they need access to affordable capital.” — SEC Chairman Jay Clayton|
Previously, the benefits that are now being expanded to include all companies were available only to EGCs, a category of issuers created in April 2012 by the JOBS Act. Registrants that qualify as EGCs can avail themselves of certain benefits, including the voluntary submission of confidential draft initial registration statements and certain scaled disclosures during and after an initial public offering (IPO). Certain disclosure relief and accommodations provided by the JOBS Act, such as the ability to file a registration statement for an equity IPO with two years of audited financial statements instead of three years, are still available only to issuers that qualify as EGCs. See the appendix to this Heads Up for a summary of benefits available to EGCs compared with those now available to non-EGCs.
The benefits provided to all registrants by the Announcement are further discussed in the Heads Up.
View the rest of the Heads Up.
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