Appendix F — Roadmap Updates for 2021 | DART – Deloitte Accounting Research Tool

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Appendix F — Roadmap Updates for 2023

The table below summarizes the substantive changes made in the 2023 edition of this Roadmap.

Section	Title	Description
1.4	The IPO Registration Statement	Added timeline of the IPO process from inception to closing for a typical 1933 Act registration statement.
1.7	Special-Purpose Acquisition Companies	Added Changing Lanes related to the SEC’s proposed rule that would require companies completing an IPO and operating companies merging with a registrant (including a SPAC) to enhance and standardize their climate-related disclosures. Further, added language to clarify interpretive guidance on disclosing cybersecurity risks and incidents.
2.4.2	Interim Financial Statements	Clarified that, although SEC regulations do not require that interim financial statements in an IPO registration statement be subject to a review under PCAOB standards, underwriters will often require that such a review be performed.
2.4.3	Age of Financial Statements	Updated the table that provides the dates on which financial statements become “stale” for a calendar-year-end company undertaking an IPO.
2.4.4	Omission of Certain Financial Information From Draft Registration Statements	Added an example demonstrating the application of the guidance in Question 101.04 of the Securities Act C&DIs. Renumbered subsequent examples.
2.5.1.3	Periods of Preacquisition Financial Statements Required	Clarified in Example 2-5 that if a company completes its IPO during the grace period, the required financial statements and pro forma financial information must be filed on Form 8-K within 75 days of the close of the acquisition.
2.5.2	Form of Financial Statements	Clarified that certain PBEs, when preparing financial statements of a non-PBE acquiree, may use non-PBE effective dates for the FASB’s leasing standard. Once the standard is adopted, the financial statements must reflect the disclosures for PBEs. Further, added clarification to reflect discussion from the October 2020 CAQ SEC Regulations Committee joint meeting with the SEC staff regarding the adoption of ASC 842’s risk-free-rate practical expedient by an acquired or to be acquired business.
2.5.2.3	Abbreviated Financial Statements	Added discussion of the presentation and disclosure requirements set forth in Regulation S-X, Rule 3-05(e)(2), for abbreviated financial statements.
2.6	Financial Statements of Real Estate Operations Acquired or to Be Acquired (Rule 3-14)	Added discussion related to financial statements and other related information required for a REIT spin or REIT conversion.
3.7.2	Evaluating Accounting Errors	Added a summary of Paul Munter’s March 9, 2022, speech on the importance of objectivity in the assessment of the materiality of errors.
3.7.5	Additional IPO Considerations	Added Changing Lanes discussing the SEC’s final rule implementing the Dodd-Frank Section 954 mandate for executive “excess compensation.” Under the final rule, an issuer must “claw back” excess compensation for the three fiscal years before the determination of a restatement and must disclose its recovery policy.
4.4.4	Pro Forma Adjustments	Removed an example related to “autonomous entity adjustments” since it is no longer applicable.
4.4.4A	Disclosure of Management’s Adjustments	Deleted discussion on management adjustments and provided a reference to Chapter 4 of Deloitte’s Roadmap SEC Reporting Considerations for Business Acquisitions for further details.
4.5.1	Presentation of Equal or Greater Prominence	Added Changing Lanes discussing the updated C&DI Question 102.10, which provides guidance on when a non-GAAP measure is more prominent than the corresponding GAAP measure.
4.5.2	Potentially Misleading Non-GAAP Measures	Expanded discussion of non-GAAP measures on the basis of SEC staff comments at the 2022 AICPA & CIMA Conference on Current SEC and PCAOB Developments. Added Changing Lanes discussing new and updated C&DIs, which provide guidance on potentially misleading non-GAAP measures (C&DI Questions 100.01, 100.04, 100.05, and 100.06).
5.4	Business Combinations	Updated reference from PCAOB AU Section 558 to PCAOB AS Section 2705.
5.5.1	Valuation of Financial Instruments	Removed language in Connecting the Dots related to the evaluation of beneficial conversion features since ASU 2020-06 is now effective for all entities.
5.6	Liabilities, Equity, and Temporary Equity	Added guidance on the presentation of equity-classified instruments in accordance with ASC 480-10-S99, which includes interpretations of SEC Regulation S-X, Rule 5-02.27. Removed language on hybrid instruments and beneficial conversion features since ASU 2020-06 is now effective for all entities.
5.8.1.1.5	Internal Revenue Code Section 409A	Added clarification related to a company’s failure to comply with the requirements in IRC Section 409A related to nonqualified deferred compensation plans.
5.8.1.1.6	Purchase of Shares From Grantees	Added discussion of a reporting entity’s consideration of share purchases from grantees by a related party or economic interest holder in the assessment of whether a past practice of settling immature shares has been established.
5.9.6.1	Disclosures in the Financial Statements	Updated Changing Lanes to cover FASB’s proposed ASU related to income tax disclosures.
5.10	Earnings per Share	Added discussion of changes in capital structure at or before closing and the impact on an entity’s EPS.
5.11	Segments	Added Changing Lanes on FASB’s proposed ASU related to segment reporting disclosures.
6.2	Independence Considerations	Added a discussion of the requirements in Sections 600 and 410 of the IESBA code, which must be addressed through the initial PCAOB Rule 3526 communications.
6.6	Changes in Auditors	Added a discussion of required disclosures under Regulation S-K, Item 304, in connection with a change in auditor during the two most recent fiscal years or any subsequent interim period. Disclosures can be provided in a Form 8-K for existing registrants; however, for an IPO, they must be provided in the IPO registration statement.
7.6	Other Post-IPO Considerations	Added two Changing Lanes on the SEC’s final rules on disclosures about (1) executive pay and company performance within certain proxy statements or information statements and (2) cybersecurity. Moreover, added Changing Lanes on the SEC’s proposed rule on disclosures about climate change.