SEC Proposes Modernization and Simplification of Regulation S-K

by Jones Day

Jones Day

In Short

The Situation: In an effort to reduce compliance and cost burdens, the SEC has proposed amendments to some of the rules and forms associated with Regulation S-K.

The Result: The proposed modifications relate to property descriptions, the management discussion and analysis section ("MD&A"), risk factors, exhibit requirements, and other matters.

Looking Ahead: Although most of the amendments will result in minor changes for filers, a few could meaningfully streamline the reporting process.

On October 11, 2017, the SEC proposed amendments to Regulation S-K and related rules and forms as required by the Fixing America's Surface Transportation Act. The proposed amendments are intended to modernize and simplify certain disclosure requirements in Regulation S-K in a way that reduces costs and burdens on registrants while continuing to provide all material information to investors.

The Proposed Amendments

The proposed amendments include changes that: (i) update and streamline the current required disclosure framework and process; (ii) update rules to account for developments that have occurred since those rules were adopted or last amended; and (iii) require additional disclosure or the incorporation of new technology.

Among other changes, the proposed amendments contemplate the following modifications to Regulation S-K:

Description of Property (Item 102)—Clarify that required disclosure is limited to physical properties only to the extent they are material to the registrant's business.

MD&A (Item 303(a))—Eliminate discussion of the earliest year in a filing covering three years if: (i) that discussion is not material to the reader's understanding of the registrant's financial condition and results of operations; and (ii) the registrant has previously filed its Form 10-K on EDGAR, including discussion of the earliest year.

Section 16(a) Compliance (Item 405)—(i) Permit registrants to rely on Section 16 reports filed on EDGAR and not require registrants to limit their inquiry to those filings; (ii) permit registrants to exclude the "Section 16(a) Beneficial Ownership Reporting Compliance" heading when there is nothing to report; and (iii) eliminate Rule 16a-3(e)'s requirement that reporting persons furnish Section 16 reports to the registrant.

Corporate Governance (Item 407)—Clarify that emerging growth companies are not required to provide a compensation committee report in connection with their annual reports.

Risk Factors (Item 503(c))—Eliminate enumerated risk factor examples provided in the instructions in an effort to encourage registrants to focus on their own risk identification processes.

Exhibits (Item 601)—(i) Require registrants to include a description of their registered securities as an exhibit to their Form 10-Ks (this description is currently required only for registration statements); (ii) allow registrants to omit schedules and attachments from all filed exhibits if they do not contain material information and the information is not otherwise disclosed in the exhibit (this accommodation is currently available only for specified exhibits such as merger agreements); (iii) permit registrants to omit confidential information from material contracts without filing a confidential treatment request where that information is not material and public disclosure of that information would be competitively harmful; (iv) limit the two-year look-back test for material contracts to newly reporting registrants; and (v) require registrants to include on their subsidiaries exhibit the legal entity identifier for each entity.

Incorporation by Reference (Item 10(d))—Eliminate the five-year limit for the incorporation of documents by reference.

In addition, the proposed amendments would require EDGAR filings to include active hyperlinks to information incorporated by reference if that information is available on EDGAR (current rules require hyperlinks to most exhibits).

A majority of the proposed amendments are peripheral in nature and will not significantly affect registrants' disclosure obligations under Regulation S-K. The few amendments that do present impactful changes aim to alleviate some of the burdens currently associated with the relevant items and should streamline preparation of filings going forward.

The full release detailing the proposed amendments can be found on the SEC's website. Comments on the proposed amendments are due 60 days after their publication in the Federal Register.

Two Key Takeaways

  1. The proposed amendments are intended to modernize and simplify disclosure requirements while still ensuring that appropriate information is available to investors.
  2. Changes include the streamlining of the disclosure process, updates to rules in response to certain developments, and requirements regarding additional disclosure or new technology integration.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Jones Day | Attorney Advertising

Written by:

Jones Day

Jones Day on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at:

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.