1.5 Rule 3-13 Waivers and Other Requests
This Roadmap does not reflect updates to the FRM made
after May 2025. See Preface for details.
There may be situations in which registrants wish to seek relief
from complying with the various reporting requirements under Regulation S-X,
including the omission of financial statements of an acquiree under Rule 3-05 or Rule 3-14 and related pro
forma financial information. Regulation S-X, Rule 3-13, gives the SEC staff the authority to
permit the omission or substitution of certain financial statements otherwise
required under Regulation S-X “where consistent with the protection of investors.”
Further, the SEC staff has historically encouraged registrants to seek modifications
to their financial reporting requirements, as permitted under Rule 3-13,
particularly when the requirements are burdensome but may not be material to the
total mix of information available to investors.
As a result of the SEC's May 2020 final rule related to business
acquisitions, there may be fewer circumstances in which registrants need waivers for
the reporting requirements under Rules 3-05 and 3-14 and Article 11; however, registrants may continue
to seek a waiver under Rule 3-13 to modify certain reporting requirements. The SEC
staff has indicated that it is available to discuss potential waiver fact patterns
by phone before a registrant submits a written request via online form.
At the 2022 AICPA & CIMA Conference on Current SEC and PCAOB
Developments, the SEC staff offered the following recommendations to registrants
submitting a waiver request related to significant acquisitions (Rule 3-05):
- Ensure that the initial waiver request is as complete as possible and includes a description of the key terms of the acquisition.
- Explain why the significance tests required by Rule 3-05 do not reflect the overall size of the acquisition.
- Articulate why the information subject to the waiver request is not necessary to protect investors.
- Explain any other compensating disclosures that will provide investors with information related to the acquisition.
Further, the SEC staff explained that when a registrant is required to file two years
of audited financial statements for a significant acquired business, it may wish to
seek a waiver for the latest annual period. In connection with that request, if a
registrant would like the waiver to also include the omission of the prior
comparative interim period information that would have been required in a two-year
presentation, this specific request should be included in the waiver letter. That
is, the waiver of the comparative interim financial statements is not automatic.
The SEC staff noted that although the above recommendations are related to waivers
for significant acquisitions (Rule 3-05), the SEC staff may also grant waivers for
significant acquisitions of real estate operations (Rule 3-14) and significant
equity method investments (Regulation S-X, Rule 3-09). Some of the recommendations
above may also apply in those circumstances.
For additional guidance on Rule 3-13 waivers and prefiling letter requests, see
Appendix B of Deloitte’s Roadmap SEC Comment Letter Considerations, Including Industry
Insights.