Frequently Asked Questions About Commission Order No. 4-460
August 8, 2002
Is it acceptable to separately list each of the company's filings that comprise the "covered reports" if an officer is filing a statement in the form of Exhibit A attached to the Order?
Officers filing statements in the form of Exhibit A should refrain from making any changes to the form of Exhibit A. If the officer lists each of the company's filings in the statement and inadvertently or otherwise fails to lists one of the "covered reports", this may cause the statement not to be considered as complying with the form of Exhibit A and, therefore, to be classified as following clause (b) of the Order, describing facts and circumstances that would make a statement in the form of Exhibit A incorrect.
Why are there fewer than 947 companies included on the list of companies whose officers are required to file sworn written statements?
A few companies that appeared on the list on June 27, 2002 when the Order was issued have been acquired by other companies and have filed a form terminating their registration and reporting requirements with the Commission. These companies have no requirement to file a periodic report on or after August 14th. Because they have no requirement to file a report on or after that date, their officers have no requirement under the Order to file a sworn written statement. Therefore, we have removed them from the list on the Web site.
July 30, 2002
Is it permissible to make inconsequential changes to a statement that is in the form of Exhibit A to the Order?
The staff has noted that some people have made minor changes to the statement in the form of Exhibit A attached to the Order that appear to be inconsequentional in nature. For example, some have added the phrase "as defined below" after the reference to covered reports. Others have sought to conform the language to reflect that, in light of their fiscal year, there is only a single "covered report" or to delete the reference to amendments or supplements since none have been filed.
These minor changes are not necessary for officers filing a sworn written statement in the form of Exhibit A. The exhibit as drafted covers each of the situations noted above. Moreover, even changes that are intended to be inconsequential could slow the processing of the statements filed by a company's officers, or could inadvertently have a substantive impact.
Accordingly, all officers filing statements in the form of Exhibit A should refrain from making any changes to the form of Exhibit A, especially since any changes that can be viewed in any way as substantive in nature will cause the statement not to be considered as complying with the exact form of Exhibit A and therefore will be classified as following clause (b) of the Order, describing facts and circumstances that would make such a statement incorrect.
July 25, 2002
If a company or its principal executive officer or principal financial officer in reviewing a company's disclosure internally with auditors and legal advisors has questions where the proper accounting treatment is not clear or where questions arise regarding difficult areas of non-financial disclosure, what should they do?
The staff welcomes the opportunity to work with companies and their officers. They are encouraged to contact the staff of the Division of Corporation Finance in the Office of the Chief Accountant at (202) 942-2960 or the Office of the Chief Counsel at (202) 942-2808 or the Commission's Office of Chief Accountant at (202) 942-4400.
Must the Secretary of the Commission physically receive the sworn statement by the close of business on the sworn statement's due date August 14, 2002 for calendar year end companies?
Yes. Although the Form 10-Q is filed on EDGAR, the statement must be delivered in written form on paper. Officers may use whatever means are appropriate, including telecopy (FAX), to ensure that the statement is physically delivered to the Secretary by the Commission's close of business on the due date. The certification may be hand delivered. A telecopy should be followed by an original. The telecopy numbers for the Secretary's office for statements filed on August 13th, 14th and 15th are (202) 824-5090 or (202) 824-5091. For statements filed any other day, the telecopy number for the Secretary's office is (202) 942-9651. E-mail is not acceptable.
Who provides the written statement if the company has replaced the principal executive officer or principal financial officer since the company filed its most recent Form 10-K or any subsequent covered report?
The officers currently holding the positions of principal executive officer and principal financial officer must provide the written statement under oath based on his or her knowledge.
The Order requires the principal executive officer and principal financial officer to
Can the wording of the written statement that is in the form of Exhibit A be changed under clause (a)?
No. Clause (a) of the Order requires the officers to file the written statement in the exact form of Exhibit A. If the statement is changed, we will consider the principal executive officer or principal financial officer to be following clause (b) above - filing a statement describing the facts and circumstances that would make such a statement incorrect. Therefore ANY change in the wording of Exhibit A will require an explanation of such facts and circumstances.
Where and how will the statements be made public?
The statements will be posted on the SEC website (www.sec.gov) as soon after receipt as possible. Thereafter, following staff review, the statements will be identified as falling into one of two categories the statements that follow the exact form of Exhibit A to the Order and "all others."
Must each officer personally review the statement with the audit committee to make the affirmative statement that the contents have been reviewed with the audit committee?
Yes, each officer must do this.
Must the officers file their statements at the same time?
No, so long as they are each filed by the deadline.
Must the officers' statements that are filed at different times cover the same covered reports?
No. Because the officers' statements are not required to be filed at the same time, one officer's statement may be filed before and one officer's statement may be filed after the required Form 10-Q or Form 10-K is filed. In that case, the statements will cover different reports.
May a company file a cover letter with the filing of the sworn written statements?
The written statement may be accompanied by a cover letter. The cover letter will also be posted on the Commission's website. An attempt in a cover letter to qualify or otherwise impact a written statement in the form of Exhibit A will result in the statement being identified on the Commission's website as falling into the "all other" category and the person making the statement would be required to explain the facts and circumstances that would make the statement that is attached as Exhibit A incorrect.
May a company file a report prior to or with the filing of the written statement that qualifies, explains or modifies the statement that is in the form of Exhibit A to the Order?
Any written statement that is preceded or accompanied by a report or other filing that modifies, qualifies or otherwise explains the sworn written statement will be considered as modifying the written statement. Therefore the statement will posted in the "all other" category on the Commission's website and the person making the statement would be required to explain the facts and circumstances that would make the statement that is attached as Exhibit A incorrect.
Are Item 9 Forms 8-K covered reports in the statement?
No. Item 9 Form 8-Ks that are "furnished" for Regulation FD purposes rather than filed are not covered reports. If an issuer chooses to file the information under Item 5 of Form 8-K, states that it is "filed" under Item 9 of Form 8-K, or incorporates it by reference into a filing under the Securities Act of 1933 or the Securities Exchange Act of 1934, the Form 8-K report would be included in the statement.
If a company with a calendar year end files its 2nd Quarter Form 10-Q prior to August 14th must its principal executive officer and principal financial officer still file a written statement?
Yes. The due date for the written statement is tied to the last date the company may file its report, regardless of the actual filing date. For a calendar year end company, that would be August 14, 2002.
May a principal executive officer or principal financial officer of a company with a calendar fiscal year end file a written statement before the 2nd quarter Form 10-Q is filed?
Yes. The officers do not have to wait for the filing of the Form 10-Q. In that case, the written statement will not cover the 2nd Quarter Form 10-Q and the officers do not need to file additional written statements after the filing of the 2nd Quarter Form 10-Q.
When are the written statements due for the officers of a non-calendar year end company?
The statements are due on the first date on or after August 14, 2002 that a company's Form 10-K or Form 10-Q is due. For example, if a company has an April 30th year end, the statements are not due until the last date the company has to file its 1st quarter Form 10-Q.
What reports does the statement cover?
The statement covers a company's latest Form 10-K and subsequent reports and definitive proxy or information statements that were filed prior to the time of the statement and all amendments thereto.
If information is incorporated by reference into the Form 10-K or other report, will that information also be subject to the written statement?
Yes. Since the information is incorporated by reference into the report to which the written statement relates, that incorporated information is also information that is covered by the statement.
What if an officer is in a foreign country and is not able to locate a notary to notarize the statement?
It is the responsibility of the officer to have his or her signature notarized by a notary or another official serving in a similar capacity.
May a company that is not subject to the Order voluntarily comply with the Order?
The company may file an Item 5 or an Item 9 Current Report on Form 8-K containing statements under oath by the principal executive officer and principal financial officer of the company. Companies not subject to the Order should not submit statements to the Secretary of the Commission.
June 28, 2002
The Order is directed to principal executive officers and principal financial officers of large companies. Which companies? The specific companies are listed in an attachment to the Order.
How many companies are listed in the attachment to the Order? 947.
Will the officers be notified and, if so, how? The officers will be notified in two ways. First, the Order includes a list of the subject companies. The Order and list is posted on the Commission's web site. Second, the officers will receive by mail a copy of the Order requesting the information.
What will the Order require a subject company to do? The Order does not require action by the companies themselves. Rather, it requires action by their principal executive officers and principal financial officers.
What will the Order require the principal executive officers and principal financial officers to do? The Order requires each of these officers to either:
(1) File a written statement, under oath, that is in the form of Exhibit A to the Order, including a statement declaring whether or not the contents of that statement have been reviewed with the company's audit committee (or, in the absence of an audit committee, the independent members of the company's board of directors); or
(2) File a written statement, under oath, describing the facts and circumstances that would make such a statement incorrect and declaring whether or not the contents of that statement have been reviewed with the company's audit committee (or, in the absence of an audit committee, the independent members of the company's board of directors).
With regard to which reports will those officers be required to make this statement? The Order requires each officer to make the statement with regard to the following reports:
(1) The company's most recent Form 10-K filed with the Commission.
(2) Any of the following that the company filed with the Commission after it filed its most recent Form 10-K:
(3) Any amendments to any of the periodic reports, current reports or proxy materials identified in number (1) or (2).
Can the officers make this statement jointly? No. Each principal executive officer and principal financial officer must provide a separate written statement.
What is the deadline for complying with the Order? Each officer is required to file the written statement with the Commission no later than the Commission's close of business on the first date that their company would be required to file a Form 10-K or Form 10-Q with the Commission on or after August 14, 2002.
If a company properly files a Form 12b-25 to extend the due date for its first
Form 10-K or Form 10-Q due on or after August 14, 2002, when is the deadline for complying with the Order? The Order's deadline is the same as the due date for that report. If Rule 12b-25 provides an extension of the due date for the subject report, it would have the effect of providing a similar extension of the deadline for compliance with the Order.
How do the officers file these written statements? The Order requires the written statements to be delivered to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 450 Fifth Street, N.W., Washington, DC, 20549-0609. It is not appropriate to file the statements on the EDGAR system. The officers should take sufficient steps to assure that the Commission's Secretary receives the written statements.
Will the Commission make the written statements public after filing? Yes.
If there are any other questions, where should they be directed? Any person with questions should call (202) 942-2808. The staff will provide procedural guidance regarding compliance with the Order.