Hello, I'm Martha Miller, the SEC's
advocate for small business capital
formation. If you're a smaller public
company or an investor in one, we want to
hear your comments on a rule change the
SEC proposed on May 9th 2019.
The proposal would amend the definitions
that determine when a public reporting
company qualifies as an accelerated
filer or a large accelerated filer.
Companies that meet those definitions
are, among other things, required to
comply with the requirement in Section
404 B of the Sarbanes-Oxley Act that an
outside, independent auditor attest to
the effectiveness of the company's
internal controls over financial
reporting.  The proposed amendments are
intended to promote capital formation
for smaller reporting issuers by
reducing compliance costs.  The amendments
would exclude from the accelerated and
large accelerated filer definitions and
issuer that meets the definition of a
smaller reporting company and had annual
revenues of less than 100 million
dollars in the most recent fiscal year
for which audited financial statements
are available.  The amendments would have the effect of increasing the number of
companies that are not required to
obtain the auditor attestation report.
My office hears from many smaller companies
and their investors about the costs and
the benefits of requiring an outside
independent auditor attestation.
Now that the Commission has a proposed rule out
for comment, getting insightful feedback
is especially valuable. A comment does
not need to be formal, lengthy, or
prepared by legal experts. Even a couple
of sentences explaining how the proposal
would impact your company or your
investment decision can be very helpful.
You can submit in three ways: through an
online forum on sec.gov,
emailing rule-comments@SEC.gov,
or by mailing a paper copy.
Every comment received is read and taken into consideration by Commission staff working on the rule.
These public comments can help influence
what the Commission adopts as a final rule.
This video was produced by the
Office of the Advocate for Small
Business Capital Formation and is meant
to provide only a very high-level
summary of the proposal. I encourage you to read the full proposal, which
discusses the reasons and potential
economic effects of the proposed rule
change in more detail. The proposal can
be found on sec.gov by clicking on the
drop down regulation tab at the top of
the page and selecting rulemaking index.
You'll see the proposal titled
amendments to the accelerated filer and
large accelerated filer definitions. We
hope you will engage with the SEC by
submitting a comment. Help shape the future of capital raising.
