United States

Proposed changes: Accelerated and large accelerated filer definitions

FINANCIAL REPORTING INSIGHTS  | 

The SEC recently a proposed rule, Amendments to the Accelerated Filer and Large Accelerated Filer Definitions. If finalized, the proposed amendments would exclude from the accelerated and large accelerated filer definitions an issuer that is eligible to be a smaller reporting company under the smaller reporting company revenue test (i.e., annual revenues of less than $100 million in the most recent fiscal year for which audited financial statements are available and public float of less than $700 million). As a result of the proposed amendments, smaller reporting companies with less than $100 million in revenues:

  • Would not be required to obtain an attestation of their internal control over financial reporting from an independent auditor. However, they would continue to be required to make assessments of the effectiveness of internal control over financial reporting.
  • Would not be subject to accelerated or large accelerated filing deadlines for annual and quarterly reports

An issuer that is eligible to be a smaller reporting company that has a public float between $75 million and $250 million would be an accelerated filer if its annual revenues are $100 million or more, and thus would remain subject to all requirements applicable to accelerated filers.

In addition, if finalized, the proposed amendments would revise the transition provisions for exiting accelerated filer and large accelerated filer status as follows:

  • Increase the public float transition threshold for accelerated and large accelerated filers to become a non-accelerated filer from $50 million to $60 million
  • Increase the threshold for exiting large accelerated filer status from $500 million to $560 million in public float
  • Allow an accelerated or large accelerated filer to become a non-accelerated filer if it becomes eligible to be a smaller reporting company under the smaller reporting company revenue test