Year-End Compliance Requirements for Corporations

As the year-end approaches, corporations registered with the Securities and Exchange Commission (SEC) must ensure compliance with various requirements to submit their annual financial statements.

Adoption Status of SEC Requirements

Here is a summary of the adoption status of SEC requirements:

Summary

Corporations must submit their annual financial statements to the SEC within the required timeframe. The statement should be prepared in accordance with the prescribed financial reporting framework and include an independent auditor’s report. The management is responsible for preparing the financial statements, while the Board of Directors (Trustees) reviews and approves them.

In addition, corporations are expected to have an effective audit function, which includes principles such as independence, professional skepticism, and due care. These principles guide external auditors in conducting audits of financial statements to achieve the overall objective of expressing an opinion on the fairness of the financial statements.

Key Updates

• The SEC has revised the standard form of SMR prescribed under Section 2(B) of SRC Rule 68, as amended.
• The expected period for the financial information in a registration statement on SEC Form 12-1 is now 180 days from the effective date.
• Independent auditors are required to adopt the principles on audit expectations for an effective external audit function.

Conclusion

Corporations must ensure compliance with these year-end requirements to avoid penalties and maintain good standing with the SEC. By understanding the key updates and requirements, corporations can effectively prepare their annual financial statements and maintain transparency in their financial reporting.