Small Public Company Forum

On December 22, 2009, the SEC’s division of corporation finance posted on www.sec.gov an updated version of a presentation noting the financial reporting issues the SEC staff frequently encounters with smaller public companies.

Use this link to access the presentation called SEC Staff Review of Common Financial Reporting Issues Facing Smaller Issuers: http://www.sec.gov/news/speech/2009/slides1209wc.pdf

Some of the key discussion points noted in the presentation are the following:

• Guidance about asking the Office of Chief Accountant financial reporting and related questions
• Overview of the SEC Comment Letter Process (as required by Sarbanes-Oxley Act of 2002, at least once every THREE years)
• Best practices for resolving any issues from the SEC Comment Letter
• XBRL  (Interactive Data to Improve Financial Reporting) compliance reminder by the end of 2011
• Effect of current financial economic results on financial reporting and disclosures
• Insight into improvements to Management’s Discussion and Analysis
• Determining fair value for equity transactions, and determining the appropriate treatment of a derivative instrument under ASC 815-40

The 50+ pages of slides are a quick read.  I strongly suggest all officers and audit committee members take the 20-30 minutes to review the data to ensure that, as the company is preparing its 2009 Form 10-K filings, this information is incorporated.

Submitted by Rachel Polson, audit partner at Baker Tilly Virchow Krause, LLP.