Registrants can qualify as a smaller reporting company (SRC) under the revised rule through either a revised public float test or a new revenue test
Qualifying registrants may apply scaled disclosure requirements on the effective date
The increased qualification thresholds require a public float of less than $250 million. Alternatively, entities with annual revenues less than $100 million will qualify when their public float is less than $700 million, or they do not have public float
Registrants that are not qualified as SRCs will qualify after meeting subsequent qualification thresholds, set at 80% of the thresholds not met in the prior year
For example, if a registrant previously had $250 million or more of public float, it would subsequently qualify as an SRC if its public float were less than $200 million on the date of the test
The SEC amended Rule 3-05 of Regulation S-X to increase the net revenue threshold from $50 million to $100 million for requiring three years of audited financial statements for an acquired business
Accelerated filer status will continue to apply to companies with more than $75 million in public float
Key facts and impacts
Why did the SEC amend the SRC definition?
Companies newly qualified as SRCs
SRCs that are also accelerated filers
Applying the qualification tests
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