Overview

The Securities and Exchange Commission ("Commission" or "SEC") is soliciting comment on proposed amendments to Regulation S-X, Regulation S-K, and various forms, including Form 20-F. The proposed amendments are intended to clarify and expand existing requirements for financial statement footnote disclosures about registrants' accounting policies for derivative financial instruments, as defined, and derivative commodity instruments, as defined. In addition, the proposed amendments require disclosure outside the financial statements of qualitative and quantitative information about market risk inherent in derivative financial instruments, other financial instruments, as defined, and derivative commodity instruments. Also, the release reminds registrants that when they provide disclosure about financial instruments, commodity positions, firm commitments, and other anticipated transactions ("reported items"), such disclosure must include disclosures about derivatives that affect directly or indirectly such reported items, to the extent the effects of such information are material and necessary to prevent the disclosure about the reported item from being misleading. In sum, these proposals are designed to make information about derivative financial instruments, other financial instruments, and derivative commodity instruments more useful to investors seeking to assess the market risk inherent in these instruments.