Financial Statements

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Desktop Staleness Calendar for 2015 Offerings

Desktop Staleness Calendar For 2015 Offerings For Issuers With A Fiscal Year Ended December 31, 2014. Please see full calendar below for more information....more

Commissioner’s Dissent May Signal Harsher Sanctions Against Accountants

Commissioner Luis A. Aguilar provided the most recent illustration of the SEC’s renewed emphasis on enforcement actions involving accounting and financial statement fraud when, on August 28, 2014, he issued a rare written...more

FASB Revises Going Concern Evaluations and Disclosure

Generally accepted accounting principles, or GAAP, presumes continuation of a reporting entity as a going concern as the basis for preparing financial statements unless and until the entity’s liquidation becomes imminent....more

Occupational Fraud Costs Global Businesses an Estimated $3.7 Trillion

Organizations lose approximately five percent of their revenue each year to internal theft and fraud, according to the Association of Certified Fraud Examiners' (ACFE) recent Report to the Nations on Occupational Fraud and...more

What’s in a Name? Changes to Article 9 of the California Uniform Commercial Code

As you are probably aware, the latest revisions to Article 9 of the California Commercial Code became effective on July 1, 2014. Rather than providing an exhaustive list of all of the revisions to Article 9 of the California...more

Mortgage Servicers Face Consumer Lawsuits Under CFPB “Periodic Statement” Final Rule

The CFPB’s final rule amending Regulation Z, which implements the Truth in Lending Act (TILA) as amended by Dodd-Frank, became effective January 10. Among other things, the new rule requires mortgage servicers to provide...more

EY Sanctioned For Acting As An Advocate For Audit Clients

Auditor independence is critical. The opinion issued by the audit firm regarding the financial statements of an audit client represents in part that the firm is independent. That judgment is based on an assessment of all the...more

Ravenswood Investment Co., L.P. v. Winmill & Co., C.A. No. 7048-VCN (Del. Ch. May 30, 2014) (Noble, V.C.)

In this decision in a proceeding pursuant to 8 Del. C. § 220, the Court of Chancery held that a corporation cannot condition a stockholder’s access to its nonpublic financial statements on the stockholder’s agreement not to...more

Fourth Circuit Affirms Dismissal of Securities Claim Alleging Accounting Fraud

If you thought it was difficult to make a federal securities fraud claim stick in the Fourth Circuit, the court has now raised the bar even higher. The Fourth Circuit recently affirmed a trial court’s dismissal of securities...more

Separate Financial Statements and the SEC’s Disclosure Effectiveness Project

SEC Division of Corporation Finance Director Keith Higgins recently suggested that the SEC will review the rules requiring separate financial statements or separate financial information under certain circumstances for...more

Finding Value: The Roles of Accountants in Franchising

Lawyers typically view the accountant’s role in franchising to be mainly auditing the franchisor’s financial statements and consenting to their use in the FDD. But accountants can play other valuable roles, from developing...more

What Your Financial Statements Tell your Lender about Your Firm

For personal injury attorneys working on contingency, securing a loan to finance case/trial costs and working capital is a great alternative when compared to partners using their own capital to fund the firm and their cases....more

Do Misstated Financial Statements Cause CEOs To Speed?

Should companies look into the driving records of the CEOs that they hire? Robert H. Davidson, Aiyesha Dey, and Abbie Smith answer that question in a forthcoming Journal of Economics paper. These authors examined a sample...more

Deadline Approaching for Reporting 2013 ISO Exercises and ESPP Transfers

Deadlines to provide information statements to employees (and former employees) as well as filings to the IRS regarding incentive stock options and employee stock purchase plans are approaching. Companies should be working to...more

Auditors’ Liability to Third Parties: Massive Liability May Not Be Indeterminate

Paradoxically, the application of the Hercules Managements duty of care test in cases like Widdrington (Estate of) v. Wightman, 2011 QCCS 1788, affirmed QCCA 1184 (“Castor Holdings”) may actually work to expand, rather than...more

"SEC Judge Issues Initial Decision Regarding Chinese Affiliates of the Big Four Accounting Firms"

On January 22, 2014, U.S. Securities and Exchange Commission Administrative Law Judge Cameron Elliot (the ALJ) issued an initial decision censuring the Chinese accounting firms affiliated with Ernst & Young LLP, KPMG LLP...more

This Week In Securities Litigation (The week ending January 10, 2014)

The insider trading trial of former SAC Capital official Matthew Martoma opened this week in Manhattan with jury selection. The SEC announced the resignation of George Canellos, Co-director of the Division of Enforcement....more

Guarantor and Affiliate Financial Statements: Finding a Silver Lining

This week in our playbook, we are talking about guarantor and affiliate financial statements. First, the bad news: As a general rule, all guarantors must present the same audited and unaudited financial statements as...more

Desktop Staleness Calendar for 2014 Offerings

DESKTOP STALENESS CALENDAR FOR 2014 OFFERINGS FOR ISSUERS WITH A FISCAL YEAR ENDED DECEMBER 31, 2013 - When Do Financial Statements Go Stale? At the close of business on the following dates in 2014 (for issuers...more

National Mortgage Servicing Settlement Monitor Adds Enforcement Metrics

On October 2, Joseph A. Smith, Jr., the Monitor of the National Mortgage Servicing Settlement announced four new metrics his office will use to measure the settling servicers’ compliance with the agreement’s servicing...more

Much Ado About Payroll Cards

In my last blog post, “To Fee or Not to Fee—The Pros and Cons of Payroll Cards,” I discussed the growing popularity of payroll cards and several U.S. senators’ plea for guidance on this burgeoning pay practice. Perhaps in...more

Financial Statement Requirements in US Securities Offerings: What You Need to Know 2013 Edition

The most frequently asked question at all-hands meetings for a securities offering is “What financial statements will be needed?” The question seems simple enough. But the answer is rarely straightforward. This User’s...more

Two More Municipal Fraud Cases From the SEC

July 2013 was a big month for the Securities and Exchange Commission (the "SEC") in its quest to increase enforcement in the municipal market. On July 19, 2013, the SEC charged the City of Miami, Florida ("Miami"), and its...more

SEC Provides Guidance On Custody Of Privately Offered Securities

The SEC’s Division of Investment Management recently offered guidance on the custody of privately offered securities....more

Are Your Procedures in Compliance with the Updated UCC Article 9?

Despite the lack of fireworks and fanfare, July 1, 2013, ushered in new changes to the Uniform Commercial Code that are important to bankers, lenders and legal practitioners. The revisions to UCC Article 9 (“Article 9”)...more

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