On the Horizon: SEC extends expiration date of registration exemption for certain security-based swaps

Contents FASB posts highlights from February 8 meeting SEC      Expiration date extended on exemptions for certain security-based swaps
     Staff to reconsider pay ratio rule implementation

AICPA      GAQC addresses confusion on Uniform Guidance reporting requirements

FASB posts highlights from February 8 meeting All decisions reached at Board meetings are tentative and may be changed at future meetings.

The FASB met on February 8 to discuss comments received on the proposed ASU, Targeted Improvements to the Accounting for Long-Duration Contracts, and to discuss feedback received from outreach conducted by the Board and the staff. No technical decisions were made.

On March 15, the Board will hold a public roundtable meeting on the proposed ASU.

SEC Expiration date extended on exemptions for certain security-based swaps The SEC recently extended the expiration date for the exemptions from registering certain security-based swaps, from February 11, 2017 to February 11, 2018. The expiration date was previously extended twice, first from February 11, 2013 to February 11, 2014 and then from February 11, 2014 to February 11, 2017.

In 2011, the SEC adopted Interim Final Rules, titled Exemptions for Security-Based Swaps, to exempt security-based swaps that were considered to be “security-based swap agreements” prior to July 16, 2011, but are now defined as “securities” under the Dodd-Frank Act, from the following requirements:

  • The registration requirements of the Securities Exchange Act of 1934
  • All provisions of the Securities Act of 1933, excluding the antifraud provisions in Section 17(a)
  • The provisions of the Trust Indenture Act of 1939

Staff to reconsider pay ratio rule implementation SEC Acting Chairman Michael S. Piwowar last week requested public input on any unexpected challenges that issuers have experienced as they prepare to comply with the Final Rule, Pay Ratio Disclosure. Certain registrants are required to comply with the Final Rule for their first fiscal year beginning on or after January 1, 2017. Comments may be submitted through March 23.

Mr. Piwowar also directed the staff to reconsider implementation of the rule based on any comments submitted and to promptly determine whether additional guidance or relief may be appropriate.

The Final Rule, which was approved in August 2015, amends existing employee compensation disclosures and requires additional disclosures in any filing that requires executive compensation information, such as a registrant’s annual report, a proxy or information statement, or a registration statement. The additional disclosures required under the Final Rule include the median of the annual total compensation of all employees of the registrant, excluding the chief executive officer; the annual total compensation of the registrant’s chief executive officer; and the ratio of these two amounts.

AICPA GAQC addresses confusion on Uniform Guidance reporting requirements The AICPA’s Governmental Audit Quality Center (GAQC) has learned from several federal agency representatives that auditees are not preparing a separate Corrective Action Plan (CAP) and Summary Schedule of Prior Audit Findings (SSPAF), as required by Section 200.511 of Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards at 2 CFR 200 (Uniform Guidance).

To address this issue, the GAQC issued an Auditee Resource Center Article, which highlights the specific requirements for the preparation of the CAP and SSPAF and provides guidance on their inclusion in the auditee’s reporting package.

© 2017 Grant Thornton LLP, U.S. member firm of Grant Thornton International Ltd. All rights reserved. This Grant Thornton LLP On the Horizon provides information and comments on current accounting and SEC reporting issues and developments. It is not a comprehensive analysis of the subject matter covered and is not intended to provide accounting or other advice or guidance with respect to the matters addressed in this publication. All relevant facts and circumstances, including the pertinent authoritative literature, need to be considered to arrive at conclusions that comply with matters addressed in this publication. For additional information on topics covered in this publication, contact a Grant Thornton client-service partner.