1.6 Reviews by Filing Status and Revenue

It is interesting to consider the filing status of registrants in the evaluation of comment letter trends and statistics. That information, however, is more meaningful when considered in relation to the percentage of registrants within each filing status classification. For example, large accelerated filers continue to be subject to a disproportionately higher number of reviews, whereas nonaccelerated filers are subject to disproportionately fewer reviews. More specifically, in review year 2025, 51 percent of the reviews with comment letters were for large accelerated filers, although large accelerated filers accounted for only 32 percent of the Forms 10-K filed in that review year. Conversely, whereas 34 percent of the reviews with comment letters were for nonaccelerated filers in review year 2025, nonaccelerated filers accounted for 58 percent of the Forms 10-K filed in that review year.

One factor that may be contributing to the trend of subjecting large accelerated filers to a disproportionately high number of reviews is that while the SEC is required under the Sarbanes-Oxley Act to review registrants at least once every three years, it is also required under that Act to consider “issuers with the largest market capitalization” in scheduling its reviews. Since registrants that have larger market caps make up a larger share of the capital markets than smaller companies, the SEC may take a risk-based approach and select larger companies for a filing review more frequently than smaller companies, in a manner consistent with the factors identified in the Act.

As discussed in Section 1.6.1, the SEC is required under the Sarbanes-Oxley Act to consider “issuers with the largest market capitalization” in scheduling its reviews. Since such issuers (i.e., companies with larger public floats) generally produce more revenue, it is no surprise that companies that generate more revenue have historically been subject to a disproportionately higher number of reviews with comment letters than companies that generate less revenue. In review year 2025, registrants generating $1 billion or more in revenue accounted for 41 percent of the reviews with comment letters and 26 percent of the Form 10-K filings. Conversely, registrants generating less than $500 million in revenue accounted for 48 percent of the reviews with comment letters and 67 percent of the Form 10-K filings in review year 2025.