While we recently saw a study about the substance of responses to Corp Fin comment letters – as Broc blogged about in May – there’s now a study focusing on the number of comment letters being issued. Check out this blog by Audit Analytics that provides some interesting statistics (& a nifty chart) about the number of comment letters referring to issues in Form 10-K and 10-Q filings that Corp Fin has issued over the past five years. Here’s an excerpt:
The overall trend is quite clear: 2014 marked the fourth straight year of steady (10% to 20% annually) decline in the number of 10-K and 10-Q comment letters. Starting in 2010 with almost 14,000 letters, the total decreased more than 50% to about 6,400 in 2014.
Audit Analytics does not draw any conclusions as to why the number of comment letters referring to Form 10-K and 10-Q filings has steadily decreased despite the SOX requirement to review the financials of every company every three years. However, it does offer some factors that may be impacting the statistics, including fewer or less complicated issues to comment on – and more resources being directed to the review of registration statements.
Checklist: Corp Fin Quick Reference Guide
Check out this “Corp Fin Quick Reference Guide” that Broc & I recently posted. The guide provides tips for interacting with the Corp Fin Staff, including:
– What’s Corp Fin?
– What’s the Organizational Structure?
– How Do I Determine Which AD Office Reviews a Company’s Filing?
– Where Can I Find Corp Fin No-Action, Interpretive & Exemptive Letters?
– Where Can I Find Additional Corp Fin Interpretations & Guidance?
– How Can I get My Questions Answered By Phone?
– How Do I Contact a Corp Fin Staffer Directly?
The guide includes a number of links to the Corp Fin web page & our site that should be helpful when you want to reach out to the Corp Fin Staff.
Poll: Why Are ’34 Act Comment Letters Decreasing?
Here’s an anonymous poll about why you think Corp Fin is issuing fewer comment letters on Form 10-Ks & 10-Qs:
– Jeff Werbitt