SEC Division Director Releases Statement on Disclosure Review Program
July 2, 2024
SEC Division of Corporation Finance Director Erik Gerding recently released a
statement in which he addressed the topics discussed during a
panel on the Division’s disclosure review program at the 2024 SEC Speaks Conference.
Mr. Gerding began by discussing the nature of the program. He pointed out that the
Division is required to “review each reporting company at least once every three
years” in accordance with the Sarbanes-Oxley Act of 2002 and that the purpose of the
disclosure review program is to “monitor and enhance compliance with disclosure
rules and accounting requirements.”
Key takeaways from Mr. Gerding’s statement include the following:
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Topics on which the SEC continues to issue comments to registrants include “China-related matters, non-GAAP disclosures, management’s discussion and analysis (MD&A), revenue recognition, and financial statement presentation.”
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Emerging areas of SEC focus for fiscal year 2023 included “market disruptions in the banking industry, cybersecurity risks, the impact of inflation, and disclosure related to newly adopted rules, such as pay versus performance.”
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Disclosure priorities for fiscal year 2024 are expected to include artificial intelligence, disclosures by China-based companies, and commercial real estate.
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The Division staff will continue to prioritize reviews of disclosures provided to comply with recently adopted SEC rules, including those on cybersecurity, clawback policies, pay versus performance, universal proxy rules, and beneficial ownership reporting.