The U.S. Securities and Exchange Commission approved amendments to Items 301, 302, and 303 of Regulation S-K in November 2020, as described in a previous Goodwin client alert, “SEC amends MD&A and Other Financial Disclosure Rules.” Those financial disclosure amendments go into effect today.
Mandatory Compliance Date. Companies will be required to apply the amended rules for their first fiscal year ending on or after August 9, 2021, and in any registration statement and prospectus that on its initial filing date is required to contain financial statements for a period on or after the mandatory compliance date.
Voluntary Early Compliance. Companies may provide disclosure consistent with one or more of the amended items in Regulation S-K at any time after the effective date, February 10, 2021. Companies that do so must provide disclosure responsive to an amended item in its entirety. For example, starting on the effective date, companies may immediately cease providing disclosure pursuant to former Item 301.
As another example, companies may voluntarily provide disclosure pursuant to amended Item 303 at any time after the effective date and before the company’s mandatory compliance date. In this case, the company must both:
- Provide disclosure pursuant to each provision of amended Item 303 in its entirety; and
- Provide the applicable amended disclosure in all applicable filings going forward.
These requirements for early compliance apply to any amended item with which a company voluntarily complies before the mandatory compliance date.
Author(s)John O. Newell