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CALIFORNIA CORPORATE & SECURITIES LAW

Does Placing Non-GAAP Financial Measures First Violate The Law?

Yesterday’s post discussed the SEC staff’s recently announced position that Item 10(e)(1)(A) of Regulation S-K requires that issuers disclose comparable GAAP financial measures before non-GAAP financial measures. Item 10(e)(1)(A) requires only that issuers afford GAAP financial measures “equal or greater prominence” as non-GAAP measures.  What then is the legal significance of the staff’s position that GAAP…

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Did The SEC Staff Bypass The APA In Issuing New And Revised Non-GAAP Financial Measure C&DIs?

Earlier this week, the staff of the SEC’s Division of Corporation Finance issued several new, and rewrote several existing, Compliance and Disclosure Interpretations (“C&DIs”) relating to Non-GAAP Financial Measures.  Recently, the SEC has been signaling that it intends to crack down on company disclosures of Non-GAAP Financial Measures.  While some are likely to welcome additional guidance…

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Adjudicate or Rule Make? That May Not Be A Question For The Courts

Professor Stephen Bainbridge yesterday passed along Henry G. Manne’s criticism of the SEC’s use of adjudication in lieu of rulemaking.  For those who haven’t taken my Administrative Law class, there are actually two types of adjudication and three different rulemaking procedures under the Administrative Procedure Act. Under the APA, adjudication is defined as the process…

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Just How Binding Are SEC Statements In An Adopting Release?

Two years ago, I coined the term ““ARR Ratio”.  The ARR Ratio (Adopting Release to Rule Ratio) is calculated by dividing the total number of words in the Adopting Release by the total number of words in the actual text of the rule being adopted.  For example, I calculated the ARR Ratio of the SEC’s Compensation…

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