CPAs and Advisors with Your Growth in Mind

JOBS Act Exemptions to Expire Soon for Emerging Growth Companies

Businesses that went public under the designation of emerging growth companies shortly after the JOBS Act of 2012 was enacted could soon lose their exemptions from the law. The five-year exemptions included in the JOBS Act, which curtails regulations for young companies that raise investor funds and encourages initial public offerings, are set to expire soon. Once the exemptions expire, hundreds of young companies will be subject to various accounting, disclosure and corporate governance requirements foreign to them. One exemption set to go away relates to Section 404(b) of the Sarbanes-Oxley Act. Section 404(b) requires an external auditor to review. Read More.

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Senate Bill Gives Sarbanes-Oxley Exemption to Small Banks

Banks holding less than $1 billion in assets could receive an exemption from the auditor attestation requirements of Section 404(b) under the Sarbanes-Oxley Act of 2002. Under S. 1962, the Community Bank Access to Capital Act of 2017, the proposed Senate bill frees smaller banks from the more complicated and expensive reforms under Sarbanes-Oxley. S. 1962 also requires public companies to hire an external auditor to attest to management’s internal controls over financial reporting. The bill’s co-sponsor, Senator Mike Rounds (R-S.D.), stated the proposed measure would promote growth among community banks and help them support their communities. Section 404(b) advocates. Read More.

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James Doty to Step Down as PCAOB Chairman, Will Help with Transition

James Doty, current chairman of the Public Company Accounting Oversight Board (“PCAOB”) of the Securities and Exchanges Commission (“SEC”), will step down once the commission has found his successor, according to an SEC announcement on August 11, 2017. Once that successor has been found and named, a date for Doty’s final day will be announced. The SEC has the authority to appoint PCAOB members under the Sarbanes-Oxley Act of 2002. Doty has been in office since 2011, and his term expired in 2015. During the early years of his term, he worked for investor protections.

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Biotech Executive Pushes for Additional Sarbanes-Oxley Exemption

Several business lobbyists say Section 404(b) in the Sarbanes-Oxley Act of 2002 requiring auditors to attest clients’ internal controls create unnecessary expenses to public companies. In response, lobbyists are asking Congress to give additional exemptions for small and medium-sized companies. Representing the Biotechnology Innovation Organization during a July 18 hearing by the House Financial Services Committee, aTyr Pharma Senior Vice President John Blake testified that biotech companies currently developing drugs do not pose the same risks as bigger companies do with their financial reporting systems. Blake believes minimal benefit is gained from the auditor attestation requirements regarding financial reporting controls.. Read More.

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FASB 2017 Accounting Support Fee Approved

The Securities and Exchange Commission (“SEC”) has approved the fees that the Financial Accounting Standards Board (“FASB”) uses to aid operations. In issuing Release No. 33-10297, Order Regarding Review of FASB Accounting Support Fee For 2017 Under Section 109 of the Sarbanes-Oxley Act Of 2002, the SEC requested that the FASB review the financial reporting taxonomy for presenting financial statements in the eXtensible Business Reporting Language. The FASB must also submit its findings prior to the SEC’s consideration for the 2018 support fee. In addition, the SEC wants to be informed about the FASB’s filled vacancies and efforts to improve. Read More.

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