Category: Securities

Revisions to Corp Fin Financial Reporting Manual — (very) limited relief for delinquent filers

by Cydney Posner Corp Fin has today posted revisions to its Financial Reporting Manual.  The only change this quarter relates to delinquent filers.  The new guidance provides that, in general, Corp Fin will not, through the comment process, require a delinquent registrant to file each one of its delinquent filings […]

Class action charges misrepresentation in policies and disclosures regarding slave labor in supply chain

by Cydney Posner As discussed in this Bloomberg article, Costco and some of its suppliers are facing class action litigation alleging that Costco misled consumers about the use of slave labor and human trafficking in its supply chain for the frozen shrimp it sells.  Concerns regarding human trafficking and slave labor […]

New GAO report on conflict minerals compliance

by Cydney Posner By coincidence, the same day that the three-judge panel of the D.C. Circuit  struck down (again) a portion of the conflict minerals rule (see this post), the GAO issued a report to Congressional Committees entitled “SEC CONFLICT MINERALS RULE Initial Disclosures Indicate Most Companies Were Unable to […]

Three-judge panel of D.C. Circuit again holds that mandatory disclosure requirement of conflict minerals rule violates First Amendment

by Cydney Posner In November 2014, the D.C. Circuit Court of Appeals granted the petitions of the SEC and Amnesty International for panel rehearing in connection with the conflict minerals case, National Association of Manufacturers, Inc. v. SEC. Today, a three-judge panel of the D.C. Circuit, by a vote of two […]

Do hiring practices lead to earnings management?

by Cydney Posner Yes, according to a study from academics at the University of South Carolina, reported by Reuters.   The study showed that U.S. public companies tend to favor hiring accountants “who show a willingness to flatter corporate profits by massaging the numbers.” In the study, which surveyed 41 executive […]

Will more regulation be imposed on stock buybacks?

by Cydney Posner Lots of companies have been buying back their stock in recent years, either on their own initiative because, for example, management thinks the shares are undervalued, or sometimes at the insistence of  hedge fund activists bent on increasing the market price of the shares.   Now, as discussed […]

In adopting pay-ratio rules, is the SEC just a mime pushing on the sides of an imaginary box?

by Cydney Posner At an open meeting this morning, SEC Commissioner Daniel Gallagher contended that, in its  efforts to adopt pay-ratio rules that conform to the Dodd-Frank mandate, the SEC was just putting itself in a box – viewing the Dodd-Frank mandate as so prescriptive that the SEC could only […]

New study gives mixed reviews to companies filing conflict minerals reports

by Cydney Posner A new study on conflict minerals compliance from Tulane University and Assent Compliance, a compliance software and services firm, revealed that about 90% of filers of conflict minerals reports indicated that they were unable to determine if their products were conflict free, the primary object of the conflict […]

Is the SEC considering reproposing mandatory proxy access rules?

by Cydney Posner The SEC has posted a new staff working paper, “Public versus Private Provision of Governance: The Case of Proxy Access,” reporting on a study conducted by the SEC’s  Division of Economic and Risk Analysis (DERA), of the “tradeoffs” between universal regulatory mandates and so-called “private ordering” in the […]

Does disclosure of a high CEO-employee pay ratio affect consumer behavior?

by Cydney Posner The answer is yes, according to a recent study from the Harvard Business School,  “Paying Up for Fair Pay: Consumers Prefer Firms with Lower CEO-to-Worker Pay Ratios.  Just in time to be part of the mood music for the SEC’s expected adoption of final pay-ratio rules on […]