February 3, 2017
Tandy Letters Live! In The Office of Chief Accountant…
Last year, we blogged about Corp Fin’s new policy of not asking for Tandy Letter reps in comment letter responses and acceleration requests. Apparently, IM also ceased requiring similar representations in connection with their review of 1933 Act and 1934 Act filings.
So I presumed that Tandy letters were dead. But I forgot about the SEC’s Office of Chief Accountant (known as “OCA”; not to be confused with Corp Fin’s own Chief Accountant’s office). OCA has required a stand-alone Tandy letter for auditor independence determinations for a long time – and still does. I can be forgiven for forgetting this as lawyers don’t often get involved in auditor independence issues…
Is there any way for the SEC’s Enforcement Division to better bring a message case then using the hit musical – “Hamilton” – in the title of a press release?
Form AP: Updated PCAOB Staff Guidance
Recently, the PCAOB issued Staff Guidance on Form AP that updates its guidance from June. Here’s the press release, which notes that the primary addition is an explanation of the filing deadline for companies that don’t file reports with the SEC…
Meanwhile, Steve Quinlivan reports that Grant Thornton became the 1st registered auditor to file a Form AP…
FASB Proposal: Call Out Debt Waivers on Balance Sheet
This Deloitte memo discusses FASB’s recent proposal to simplify the process of determining whether debt should be classified as “current” or “noncurrent” – that’s “long-term” to us Earthlings – on a balance sheet. One part of the proposal that caught my eye relates to the disclosure of lender waivers of covenant defaults:
Entities would be required to separately present the amount of debt that is classified as noncurrent as a result of the waiver exception on the face of a classified balance sheet.
Some folks have tried to play games with disclosure of covenant waivers over the years, but I think there’s a recognition of the need for greater transparency about them. Under the new proposal, there would be no place to hide.
– Broc Romanek