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On Nov. 19, the U.S. Securities and Exchange Commission (SEC) adopted final amendments, available here, to Regulation S-K, and related rules and forms, to further “modernize, simplify and enhance” certain financial disclosure requirements in Regulation S-K. Specifically, the amendments eliminate Item 301 (Selected Financial Data) in its entirety and update and simplify Item 302(a) (Supplementary Financial Information) and Item 303 (Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A)). The SEC intends these amendments to eliminate duplicative disclosures, enhance the focus of financial disclosures on material information for the benefit of investors and simplify compliance efforts for companies.

Background

On Jan. 30, the SEC proposed amendments to Regulation S-K, and related rules and forms, to eliminate Item 301 and Item 302 in their entirety and to update, simplify and enhance the disclosure requirements in Item 303. The SEC proposed these amendments as part of its ongoing review and assessment of disclosure requirements in Regulation S-K, which focuses on modernizing and improving disclosure while reducing compliance costs for companies and continuing to provide investors with material information. The final amendments described here reflect the SEC’s consideration of comment letters received in response to the proposed amendments and significant changes in the regulatory and business landscape since the initial adoption of Regulation S-K.

Description of Final Amendments

The following table summarizes the final amendments to Regulation S-K.

Compliance Date

The final rules are effective 30 days after their publication in the Federal Register. Companies must apply the amended rules to their first fiscal year ending on or after the date that is 210 days after the publication date (mandatory compliance date). This means that a calendar-year filer must begin complying with the amended disclosure requirements in its annual report on Form 10-K for the fiscal year ending Dec. 31, 2021. A calendar-year filer need not comply with the amended disclosure requirements in any quarterly report on Form 10-Q filed during the 2021 calendar year. However, prior to the mandatory compliance date such filers may comply with the amended disclosure requirements, on an item-by-item basis, at any time after the effective date as long as they comply with the amended disclosure requirements of the applicable item in its entirety. Companies must apply the amended rules in a registration statement and prospectus that, on its initial filing date, is required to contain financial statements for a period on or after the mandatory compliance date.