October 19, 2021

EY Highlights SEC Staff Comment Letter Trends

EY recently published highlights from its most recent SEC Staff comment letter survey, noting:

  • Non-GAAP financial measures remained in the top spot in thelist of the most frequent topics in SEC staff comment letters for the year ended June 30, 2021. Management’s discussion and analysis and segment reporting were second and third, respectively.
  • The volume of SEC staff comment letters on periodic reports continued to decline and was down by 20% from the previous year.
  • The Staff continued to issue comment letters addressing COVID-19 disclosures in MD&A, business descriptions, and risk factors in addition to disclosures about fair value measurements and other topics, including the use of non-GAAP financial measures.
  • The SEC staff has started issuing comments on climate-related disclosures, including considerations of the Commission’s 2010 guidance.
  • Companies planning to go public through an initial public offering or merger with a SPAC should consider the topics of frequent comment when preparing their initial registration statements and subsequent filings.

The EY publication also includes tips on how to navigate the comment-letter process. For even more details on that, members should check out our 43-page “SEC Comment Letter Process” Handbook, which was recently revised & updated by former Staffers Sonia Barros & Sara von Althann of Sidley Austin.

– Dave Lynn