SEC Relief Order
In response to the ongoing COVID-19 outbreak, the SEC has provided public companies an option to apply for a 45-day extension for any filings due from March 1, 2020 through April 30, 2020.
While this relief may not apply to most accelerated filers, the SEC has left open the possibility of an extension. Therefore, we encourage companies to monitor developments in this area if they believe their Q1 2020 close process may be significantly impacted.
In order to qualify for the relief, companies must meet the following conditions:
- Registrant is unable to meet a filing deadline due to circumstances related to COVID-19;
- Registrant is required to file Form 8-K by either March 16 or original filing deadline (whichever is later) and state:
- That it is relying on the relief order;
- Brief description of the reasons why it could not file on a timely basis; and
- Estimated date by which it expects file.
- Risk factors explaining, if material, the impact of COVID-19 on its business; and
- If the reason the filing cannot be done in a timely manner is due to the inability of another party to furnish any required opinion, report or certification, then attach a statement signed by such party stating the specific reasons for the delay;
- Filing needs to be completed no later than 45 days after the original due date.
It must be noted that a few accelerated filers have included the potential impact of COVID-19 as a risk factor in the Item 1 section of their 2019 10-K. These disclosures have outlined disruptions to business operations, economic risks, demand and supply risks as well as the risk of access to liquidity. For those companies who have not yet filed their 2019 10-K, it is recommended that management reassess their risk factors and outline the potential impact to investors.
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