Recent SEC’s Enforcement Actions Highlight Continued Focus on Late Filing Disclosures

On August 22, 2023, the Securities and Exchange Commission (the “SEC”) announced that it had instituted and settled proceedings against five public companies for failing to disclose in Form 12b-25 that their request for seeking a delayed quarterly or annual reporting filing was caused by an anticipated restatement or correction of prior financial reporting. See | SEC Charges Five Companies for Failure to Disclose Complete Information On Form NT. In April 2021, the Commission identified and charged eight companies for similar violations. See | SEC Charges Eight Companies for Failure to Disclose Complete Information on Form NT.

These charges are a reminder that filing a Form 12b-25 “Notification of Late Filing,” commonly known as “Form NT,” is not only a necessary procedural step when an issuer will be delayed in filing a Form 10-K, Form 10-Q, Form 20-F or other specified report; it is also a decision point for making potentially sensitive disclosure to the market and should reflect input from senior management and in house and outside counsel, as well as the company’s audit committee and disclosure committee (if one exists).  In the restatement context, the company’s auditors also likely will want to review and comment on the draft Form NT prior to filing. See SEC Enforcement of Form NT Disclosure Requirements for a more detailed discussion of the SEC orders and the requirements of Rule 12b-25 and Form NT.