Hot Topic | February 2020

SEC issues Regulation S-K proposal to streamline disclosures

SEC proposes amendments to MD&A and other financial disclosure requirements to eliminate repetition, enhance disclosures, and simplify compliance efforts.


SEC Release Nos. 33-10750; 34-88093; IC-33795; File No. S7-01-20

  • Public companies

Relevant dates

  • Comments are due April 28, 2020

Key impacts

As part of the SEC’s ongoing evaluation of disclosure requirements, the proposed amendments are intended to modernize, simplify and enhance financial disclosures. They would eliminate selected financial data, supplementary financial information, and amend MD&A presentation. 

The proposed amendments to MD&A would, among other things: 

  • Add a new item to state the objectives of MD&A for both fiscal years and interim periods
  • Replace the requirement to discuss off-balance sheet arrangements under a separate caption with a principles-based instruction
  • Eliminate tabular disclosure of contractual obligations
  • Eliminate the requirement to discuss inflation and the impact of changing prices
  • Add critical accounting estimates as a new disclosure requirement
  • Revise the interim disclosure requirement to allow registrants the flexibility to compare the current quarter to either the corresponding quarter in the prior year or the prior quarter
  • Clarify requirements (in italics) to disclose:
    • Material cash requirements
    • Known events that are reasonably likely to cause a material change in the relationship between costs and revenues
    • Underlying reasons for material changes (i.e. increases and decreases) in net sales or revenues.

Certain conforming amendments would also apply to Forms 20-F and 40-F.



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