In a recently released white paper, staff at the Office of Research and Analysis of the PCAOB provided some insight into so-called “Emerging Growth Companies”. Emerging Growth Companies are a relatively new class of SEC registrants. Defined under the JOBS Act of 2012, the purpose of the designation was to encourage growth by reducing some regulatory obligations for smaller companies.
Sourcing data from Audit Analytics, the authors provide a general overview of certain characteristics of these companies.
Below is a chart from the PCAOB report showing the overall growth in EGCs since 2012.
Another interesting chart shows the breakdown of EGCs by industry. As one can see, the most common industry of EGC filers (based on SIC code) is pharmaceutical preparations, with blank check companies a close second.
The report also explores, among other statistics, the growth in the number of EGC filers since the enactment of the JOBS Act, the industry and financial characteristics of EGC filers, and auditor observations associated with EGC filers.
The whole white paper is available here.