Heads Up — SEC seeks input on Regulation S-X and required financial information about certain entities other than the registrant

The SEC recently issued a release that requests public comment on the effectiveness of the financial disclosure requirements in Regulation S-X that apply to certain entities other than the registrant. The publication is the first request for comment associated with the Commission’s disclosure effectiveness initiative, a broad-based staff review of the disclosure requirements in the SEC’s rules as well as the presentation and delivery of those disclosures. SEC Chairman Mary Jo White indicated that the request for comment is an “important step in our review of the disclosure requirements” and will “help us evaluate potential changes to Regulation S-X that would benefit both investors and companies.”

This is a preview of the Heads Up. View the complete Heads Up.

Entities other than the registrant whose financial information may need to be disclosed may include acquired businesses, equity method investees, guarantors and issuers of guaranteed securities, and affiliates whose securities collateralize registered securities. The request for comment includes 58 questions about the disclosure requirements; the overall themes of these questions can be characterized as follows:

  • How well do the requirements of each rule inform investors, and how do investors use the disclosures to make investment and voting decisions?
  • What challenges do companies face in satisfying the requirements?
  • What changes should be made to the requirements?

Comments on the release are due by November 30, 2015.

Volume 22, Issue 35 | October 6, 2015


The request for comment primarily focuses on the following Regulation S-X rules:

  • Rule 3-05, “Financial Statements of Businesses Acquired or to Be Acquired” (and related requirements).
  • Rule 3-09, “Separate Financial Statements of Subsidiaries Not Consolidated and 50 Percent or Less Owned Persons.”
  • Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.”
  • Rule 3-16, “Financial Statements of Affiliates Whose Securities Collateralize an Issue Registered or Being Registered.”

Editor’s Note: For more information about the above Regulation S-X rules, see Deloitte's Roadmap to SEC Comment Letter Considerations, Including Industry Insights.

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