SOX Compliance Deadline for a Foreign Filer 1867
milan last edited by
A question was recently posed…
A public company based in India has ADRs listed on the NYSE. The Company is certain that it must comply with Sarbanes-Oxley. It has a fiscal year ending 3/31/07. The USD value of the ADRs is clearly less than USD75 million. However, it is not clear about the deadline applicable to it.
Any help and feedback would be greatly appreciated.
Denis last edited by
Value of the ADRs doesn’t matter for foreign filers. They will have to comply in filing the 31/3/07 20-F.
Foreign filers are due to file the first year end finishing after 15th July '06.
EMM last edited by
There are allowances for accelerated filers and non accelerated filers which have changes the deadlines.%0A An FPI which is an accelerated filer that is not a larger accelerated filer does not require auditor attestation until year -ends after 15 July 2007 (they will still have to have executive certificaiton). Additional delays have also been granted to non-accelerated filers - See below:%0A ‘Relief from Section 404 Compliance Dates for Smaller Companies (Non-Accelerated Filers). The Commission is proposing to grant relief to smaller public companies by extending the date by which non-accelerated filers must start providing a report by management assessing the effectiveness of the company’s internal control over financial reporting. The initial compliance date for these companies would be moved from fiscal years ending on or after July 15, 2007, until fiscal years ending on or after Dec. 15, 2007. The Commission also proposes to extend the date by which non-accelerated filers must begin to comply with the Section 404(b) requirement to provide an auditor’s attestation report on internal control over financial reporting in their annual reports. This deadline would be moved to the first annual report for a fiscal year ending on or after Dec. 15, 2008. This proposed extension would result in all non-accelerated filers being required to complete only the management’s portion of the internal control requirements in their first year of compliance with the requirements. This proposal is intended to provide cost savings and efficiency opportunities to smaller public companies and to assist them as they prepare to comply fully with Section 404’s reporting requirements. This proposed extension will provide these issuers and their auditors an additional year to consider, and adapt to, the changes in Auditing Standard No. 2 that the Commission and the Public Company Accounting Oversight Board intend to make, as well as the guidance for management the SEC intends to issue, to improve the efficiency of the Section 404(b) auditor attestation report process. %0AApproximately 44% of the domestic companies and 38% of the foreign private issuers that file periodic reports with the Commission are non-accelerated filers. %0AThe Commission seeks public comment on all aspects of this proposal. Comments should be submitted within 30 days of the proposal’s publication in the Federal Register. %0ARelief from Section 404(b) Compliance Date for Certain Foreign Private Issuers. The Commission is granting relief from Section 404(b) compliance for foreign private issuers that are accelerated filers (but not large accelerated filers), and that file their annual reports on Form 20-F or 40-F. These companies will have their compliance deadline extended for an additional year, so that they will not begin complying with the Section 404(b) requirement to provide an auditor’s attestation report on internal control over financial reporting in their annual reports until fiscal years ending on or after July 15, 2007. This group of issuers will be required to comply only with the Section 404 requirement to include management’s report in the Form 20-F or 40-F annual report filed for their first fiscal year ending on or after July 15, 2006. They will not need to comply with the requirement to provide the registered public accounting firm’s attestation report until they file a Form 20-F or 40-F annual report for a fiscal year ending on or after July 15, 2007. %0AThe Commission’s data indicate that about 23% of the approximately 1,200 foreign private issuers that are subject to the Exchange Act reporting requirements are accelerated filers that will receive the one-year extension of the compliance dates for the Section 404(b) auditor attestation requirement. Because approximately 38% of foreign private issuers are non-accelerated filers that will benefit from the steps outlined in Item 1 above, over 60% of the community of foreign private issuers will receive a measure of relief as a result of the actions we’re announcing today. The Commission’s actions today do not change the date by which a foreign private issuer that is a large accelerated filer must comply with both the Section 404(a) and (b) requirements. These filers are required to include both a report by management and an attestation report by the issuer’s registered accounting firm on internal control over financial reporting in their Form 20-F or 40-F filed for a fiscal year ending on or after July 15, 2006.%0AThis extension is a final Commission action and will be effective shortly, on the date that the Commission release granting the extension is published in the Federal register.’ [/url]
milan last edited by
As always, thank you for your thoughts and helpful feedback.