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SEC filer status assessment for calendar year-end public companies is as of June 30
Publication date: 20 Jun 2024
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SEC filer status assessment for calendar year-end public companies is as of June 30
A US public company is required to calculate its public float1 as part of the annual assessment of its accelerated filer status as of the last business day of its most recently completed second fiscal quarter. SEC accelerated filer status (i.e., large accelerated filer, accelerated filer, non-accelerated filer) can impact both a company’s SEC filing timelines as well as certain disclosure requirements (e.g., whether or not an auditor's attestation is required for internal control over financial reporting under Sarbanes Oxley Act section 404(b)). In addition, an emerging growth company (EGC) that becomes a large accelerated filer would no longer qualify as an EGC.2
Any change in the accelerated filer status takes effect on the last day of a company’s fiscal year, meaning the annual report for that year end must be based on requirements for the newly assessed accelerated filer status. Loss of EGC status as a result of becoming a large accelerated filer would also be applicable as of the last day of a company’s fiscal year. See SEC Volume 3125 for guidance on accelerated filer status thresholds and transitioning between different accelerated filer status categories and see SEC Volume 2170 for more information on EGC determinations.
Public float as of the last day of the second fiscal quarter can also impact a company’s smaller reporting company (SRC) status. Companies entering SRC status are permitted to begin reporting using scaled SRC disclosures immediately, while those exiting SRC status are no longer eligible to use the scaled SRC disclosures beginning with the Form 10-Q for the first quarter of the subsequent fiscal year. See SEC volume 2160 for more information on SRC determinations.
Foreign private issuers (FPIs) must evaluate their FPI status as of the last day of the second fiscal quarter (determination date), including assessing whether more than 50% of their outstanding voting securities are directly or indirectly owned by US residents. Loss of FPI status results in the company being required to comply with domestic registrant forms and requirements beginning the first day of the fiscal year following the determination date. Among significant potential changes, the company would need to file on an accelerated timeline, begin filing quarterly reports, and if currently using IFRS, it would be required to convert its financial statements to US GAAP.
Companies should work with legal counsel in connection with public float calculations and consideration of other factors in connection with accelerated filer, SRC, EGC, and/or FPI status determinations.
1 Public float refers to the aggregate worldwide market value of the voting and non-voting common equity held by non-affiliates. See Exchange Act Rule 12b-2 for more information.
2 There are other factors beyond public float that can impact a company’s accelerated filer status or its continued qualification as an EGC as applicable. Companies should work with legal counsel in connection with annual and ongoing assessments.
A US public company is required to calculate its public float1 as part of the annual assessment of its accelerated filer status as of the last business day of its most recently completed second fiscal quarter. SEC accelerated filer status (i.e., large accelerated filer, accelerated filer, non-accelerated filer) can impact both a company’s SEC filing timelines as well as certain disclosure requirements (e.g., whether or not an auditor's attestation is required for internal control over financial reporting under Sarbanes Oxley Act section 404(b)). In addition, an emerging growth company (EGC) that becomes a large accelerated filer would no longer qualify as an EGC.2
Any change in the accelerated filer status takes effect on the last day of a company’s fiscal year, meaning the annual report for that year end must be based on requirements for the newly assessed accelerated filer status. Loss of EGC status as a result of becoming a large accelerated filer would also be applicable as of the last day of a company’s fiscal year. See SEC Volume 3125 for guidance on accelerated filer status thresholds and transitioning between different accelerated filer status categories and see SEC Volume 2170 for more information on EGC determinations.
Public float as of the last day of the second fiscal quarter can also impact a company’s smaller reporting company (SRC) status. Companies entering SRC status are permitted to begin reporting using scaled SRC disclosures immediately, while those exiting SRC status are no longer eligible to use the scaled SRC disclosures beginning with the Form 10-Q for the first quarter of the subsequent fiscal year. See SEC volume 2160 for more information on SRC determinations.
Foreign private issuers (FPIs) must evaluate their FPI status as of the last day of the second fiscal quarter (determination date), including assessing whether more than 50% of their outstanding voting securities are directly or indirectly owned by US residents. Loss of FPI status results in the company being required to comply with domestic registrant forms and requirements beginning the first day of the fiscal year following the determination date. Among significant potential changes, the company would need to file on an accelerated timeline, begin filing quarterly reports, and if currently using IFRS, it would be required to convert its financial statements to US GAAP.
Companies should work with legal counsel in connection with public float calculations and consideration of other factors in connection with accelerated filer, SRC, EGC, and/or FPI status determinations.
1 Public float refers to the aggregate worldwide market value of the voting and non-voting common equity held by non-affiliates. See Exchange Act Rule 12b-2 for more information.
2 There are other factors beyond public float that can impact a company’s accelerated filer status or its continued qualification as an EGC as applicable. Companies should work with legal counsel in connection with annual and ongoing assessments.
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