SEC's small business initiatives supported - with modifications.The Securities and Exchange Commission's efforts to simplify disclosure requirements for small businesses, especially initial public offerings (IPOs) and offerings exempt from registration, have received qualified support from the SEC regulations committee of the American Institute of CPAs. In a letter to the SEC, the committee supported the proposed small business initiatives (set forth in SEC release no. 33-6924), while offering several modifications. The following are among the actions the committee recommended to the SEC to ensure the proposed rules do not diminish the protection investors receive from independent audits of financial information: * Conduct a cost-benefit analysis cost-benefit analysis In governmental planning and budgeting, the attempt to measure the social benefits of a proposed project in monetary terms and compare them with its costs. to determine whether two years of comparative audited balance sheets should be presented in IPO (Initial Public Offering) The first time a company offers shares of stock to the public. While not a computer term per se, many founders, employees and insiders of computer companies have found this acronym more exciting than any tech term they ever heard. filings. In addition, regulation S-B S-B Stoer-Bulirsch (sampling algorithm) should require post-IPO filings to include audited financial statements for the same number of periods currently required by regulation S-X S-X Sex . * Define the term "small business issuer small business issuer An issuer of securities that has less than $25 million in annual revenues and outstanding publicly held stock worth no more than $25 million. Public offerings by small businesses are subject to special SEC registration rules. " in regulation S-B as a company with annual average market capitalization Market Capitalization A measure of a public company's size. Market capitalization is the total dollar value of all outstanding shares. It's calculated by multiplying the number of shares times the current market price. This term is often referred to as market cap. that does not exceed a specified amount for the preceding fiscal year. * Adopt uniform management discussion and analysis reporting formats under regulations S-B, A and S-K. * Establish a certain dollar threshold above which audited financial statements should be required in regulation A filings. * Simplify reporting requirements for limited offerings to be met by small business issuers that wish to raise additional capital subsequent to an IPO. * Take steps to ease Securities Exchange Act registration for regulation A issuers. * Clarify applicability of staff accounting bulletins, financial reporting requirements and regulation S-X reporting requirements. |
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