Friday, December 02, 2011

SEC Plans Earlier Release of Comment Letter Correspondence on EDGAR

The Division of Corporation Finance and Division of Investment Management have jointly announced plans to publicly release comment letter correspondence on EDGAR sooner after the end of companies’ disclosure reviews (Corp Fin; Investment Management). Currently, the SEC staff publishes SEC-generated comment letters and issuer replies no earlier than 45 days after a disclosure review is complete. Beginning January 1, 2012, the staff will release these documents no earlier than 20 business days following completion of a disclosure review. The announcement stated that the purpose of the accelerated release schedule is “[t]o further enhance the transparency of the filing review process.”

In May 2005, the SEC staff began to publicly release staff comments and issuer responses regarding filings made after August 1, 2004 on EDGAR. The comment letter process allows the Commission staff to express concerns to issuers regarding their disclosures, and allows issuers to revise their disclosures to better comply with the securities laws and regulations. Issuers are responsible for the accuracy of their replies. Staff comments, however, do not bar SEC enforcement and cannot be raised as a defense to any legal action.