Recently, the SEC adopted technical amendments to several rules and forms to reflect securities law amendments included in the JOBS Act of 2012. Title I of the JOBS Act created the “emerging growth company” filer status, which permits reduced disclosures in an IPO registration statement and provides a temporary exemption from certain financial reporting and governance requirements thereafter. As Title I of the JOBS Act was self-executing, SEC rulemaking was not required for emerging growth companies to take advantage of the relief provided by Title I. However, the SEC’s rules and forms did not reflect the Title I provisions until the technical amendments made last week. These amendments also modify the cover page of various periodic and transactional reports to include two check boxes – the first to indicate whether the issuer is an emerging growth company and the second to indicate whether the issuer has elected not to use the extended transition period for complying with any new or revised accounting standards.
In addition to the form and rule amendments, the SEC also adopted new rules to include an inflation-adjusted threshold in the definition of an emerging growth company. The JOBS Act requires the Commission to index to inflation the annual gross revenue amount to determine emerging growth company status every five years. Accordingly, the emerging growth company revenue threshold was increased from $1,000,000,000 to $1,070,000,000. Similar inflation adjustments were made to the offering and investment limits in the crowdfunding rules as well (e.g., the maximum amount an issuer can sell under Regulation Crowdfunding in a year increased from $1,000,000 to $1,070,000).
Centri Business Consulting is dedicated to providing the highest quality finance and accounting consulting services to its clients by being reliable and responsive to their needs. Centri provides companies with the expertise they need to meet their reporting demands. Centri specializes in financial reporting, internal controls, technical accounting research and CFO Advisory Services for companies of various sizes and industries. From complex technical accounting transactions to monthly financial reporting, our professionals can offer any organization the specialized expertise and multilayered skill sets to ensure the work gets done right.