March 13, 2006

Form 10-K Confusion: Voluntary Filer Status

As companies fill out the new checkboxes on the cover of their Form 10-Ks, there appears to be a bit of understandable confusion regarding the checkbox that relates to “voluntary filer” status (eg. see #1569 in our Q&A Forum; in addition, a number of companies that have already filed checked the wrong box). This checkbox states:

“Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ___ Yes ____ No”

Rest assured that if “yes” is checked for this checkbox, that means the company is stating that it is a voluntary filer (and the EDGAR nest in the header should also be “yes”).

I can understand how the double negative in the checkbox causes some confusion; we probably would have been better off with a single box – like the Item 405 checkbox – rather than being faced with a “yes/no” set of boxes.

Comments on the SEC’s E-Proxy Proposal

The comment period closed on February 13th for the SEC’s E-Proxy proposal and final rules shouldn’t be expected anytime soon given that the new Corp Fin Director hasn’t started work yet. Scanning through the comment letters, it appears that the nature of the comments are all over the lot, with some fully supporting the idea and others not favoring it at all.

One of the more interesting comments came from AARP, which polled its members regarding their Internet use – 1500 retirees responded! – and found that 84% have access to the Internet at home (with 64% of those having high-speed access – we have posted the full survey results). Even despite the relatively high level of Internet use, it’s not too surprising that this group favors regular mail for their proxy materials.

In this podcast, Carl Hagberg provides his thoughts on the E-Proxy proposal (here is the comment letter that Carl submitted to the SEC), including:

– What are the primary issues that you see in the SEC’s e-proxy proposal?
– What should companies consider doing regarding these issues?
– What are your recommendations to tweak the SEC’s proposal?
– Does the SEC’s proposal change the playing field at all?

SEC Proposes PCAOB’s Independence and Ethics Standard

Last week, the SEC finally issued the PCAOB’s proposal – which was sent to the SEC last July! – that would prohibit auditors from engaging in aggressive and abusive tax services, among other matters. The SEC and PCAOB staff had a lot of interatction on this proposal before it was ever proposed by the PCOAB, so it is certainly due. Comments are due 35 days from publication in the Federal Register.