At three significant year-end conferences, members of the SEC’s senior accounting and legal staff reinforced previously delivered guidance on several key financial reporting issues relevant to preparation of upcoming earnings releases, the 2016 Form 10-K and subsequent filings. We expect that the announced departures of SEC Chair Mary Jo White, Division of Corporation Finance Director Keith Higgins and Division of Enforcement Director Andrew Ceresney will not diminish the career staff’s promised close scrutiny in the new year of how well companies are following this guidance. Whether or not the Enforcement Division’s vigorous pursuit of accounting, internal controls and auditor independence cases will continue under the next administration is somewhat more difficult to predict, however, and will bear watching.
The financial reporting guidance discussed in this Alert is drawn from staff remarks delivered at Practising Law Institute’s 48th Annual Institute on Securities Regulation held on November 2-4, the Fall Meeting of the ABA Committee on Federal Regulation of Securities held on November 18-19, and the AICPA National Conference on Current SEC & PCAOB Developments held on December 5-7, 2016. We also cover staff guidance for the next round of conflict minerals disclosure, which was delivered at the PLI conference. Throughout this Alert we provide practical tips in “What to do Now?” sections.