The total amount of comment letters stemming from 10-K and 10-Q filings has once again decreased (as shown in the chart below). From 2017 to 2018, total comment letters decreased by roughly 26%, which is slightly steeper than the decline we’ve … Continue reading
Category Archives: SEC Comment Letters
Shutdown Slows Comment Letters, IPOs
On Friday, January 25th, 2019, President Trump signed a bill to reopen the federal government [temporarily] for three weeks, putting an end to the longest government shutdown in U.S. history. The following day, SEC Chairman Jay Clayton released a statement … Continue reading
Kingsway Financial Services, Inc. [KFS]: Extensive SEC Comment Letter Conversation Identifies Accounting Errors
Kingsway Financial Services, Inc. [KFS] was forced to restate financial statements to correct revenue recognition errors related to adoption of ASC 606 and its effect on warranty subscriptions and commissions The restatement was triggered by a 15-letter comment letter conversation … Continue reading
PayPal: SEC Requests Clarification about TIO Intangibles
In August 2018, the SEC issued comments to PayPal Holdings Inc. [PYPL] requesting clarification about the value of intangible assets recorded during the acquisition of TIO Networks. In July 2017, PayPal acquired Canadian payment-processing company TIO Networks for $238 million. … Continue reading
Ollie’s Bargain Outlets’ Elimination of Critical Accounting Disclosure Draws SEC Attention
Retailer Ollie’s Bargain Outlet Holdings, Inc. [OLLI] recently drew the SEC’s attention when the company said it would eliminate all of its critical accounting estimates. The SEC requires companies to make critical accounting disclosures when a firm must make judgment … Continue reading
A Look at Top SEC Comment Letter Issues in 2018
The number of SEC comment letters has been declining for nine consecutive years. During the first nine months of 2018, 2,174 letters were filed1 (831 CORRESPs and 1,343 UPLOADs) – a decrease of 40% from the 3,629 letters that were … Continue reading
SEC Registrants with Poor Cyber Controls
On October 16, 2018, the SEC’s Division of Enforcement issued an investigative report regarding cyber-related fraud’s effect on public company internal controls. The report reviewed nine cases in which public companies’ electronic communications were used to perpetrate fraudulent payments. All … Continue reading