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On January 30, 2009, the SEC adopted rules which require public companies to publish their financial statements in an interactive format using the eXtensible Business Reporting Language, or XBRL.  Large accelerated filers were transitioned to XBRL in 2009 and 2010.  All other issuers must begin providing interactive data with Form 10-Q for a fiscal period ending on or after June 15, 2011. 

Certainly with proxy access, say-on-pay and other new Dodd-Frank items on the way, public companies have had a lot to digest.  However we urge public companies to plan appropriately for transition to the XBRL regime when implementing their 2011 compliance plans.

The XBRL data will be provided as an exhibit to periodic and current reports and registration statements.  In addition, a filer required to provide financial statements in XBRL format to the SEC also will be required to post those financial statements in XBRL format on its corporate website (if it has one) not later than the end of the calendar day it filed or was required to file the related registration statement or report with the SEC, whichever is earlier.  The interactive data should be accessible through the filer’s website address normally used by the filer to disseminate information to investors.  The interactive data is required to be posted for at least 12 months.  Filers may not comply with the web posting requirement by including a hyperlink to the SEC website.

Once subject to the XBRL rules, issuers should begin checking the box on the cover page of Forms 10-K and 10-Q regarding whether all XBRL filings have been made.

When adopting the new rules, the SEC amended Rules 13a-14 and 15d-15 to explicitly state the CEO and CFO certifications do not apply to the interactive data required to be submitted as an exhibit.

Filers that do not provide or post required interactive data on the date required:

  • Will be deemed not current with their Exchange Act reports and, as a result, will not be eligible to use the short Form S-3 or S-8, or elect under Form S-4 to provide information at a level prescribed by Form S-3.
  • Will not be deemed to have available adequate current public information for purposes of the resale exemption safe harbor provided by Rule 144.

A filer that is deemed not current solely as a result of not providing or posting an interactive data exhibit when required will be deemed current upon providing or posting the interactive data. Therefore, it will regain current status for purposes of short form registration statement eligibility, and determining adequate current public information under Rule 144. As such, it will not lose its status as having “timely” filed its Exchange Act reports solely as a result of the delay in providing interactive data.

Check frequently for updates on the Dodd-Frank Act and other important securities law matters.