ARTICLE
11 July 2025

SEC Staff Updates Its Financial Reporting Manual

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Goodwin Procter LLP

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The staff of the SEC's Division of Corporation Finance periodically publish informal staff interpretations to the public via the Financial Reporting Manual (FRM). On July 2, 2025...
United States Corporate/Commercial Law

The staff of the SEC's Division of Corporation Finance periodically publish informal staff interpretations to the public via the Financial Reporting Manual (FRM). On July 2, 2025, the staff announced that it had published an updated version of the FRM effective June 30, 2025.

The updated version of the FRM reflect substantive changes related to the amendments to Regulation S-X Acquisition Rules (S-X 3-05, S-X 3-14, S-X 8-04, and S-X 8-06) and Regulation S-X Article 11 adopted in 2020. The 2020 amendments updated disclosure rules related to acquisitions of other entities by, among other things, updating the significance tests in Rule 1-02(w); modifying and enhancing the required disclosure for the aggregate effect of acquisitions for which financial statements are not required or are not yet required by eliminating historical financial statements for insignificant businesses; requiring that financial statements of an acquired business cover no more than the two most recent fiscal years; and amending the pro forma financial information requirements to improve the content and relevance of such information.

Notably, the updates to the FRM do not include changes for certain rulemakings, including Qualifications of Accountants, Management's Discussion and Analysis Selected Financial Data, and Supplementary Financial Information, and Special Purpose Acquisition Companies, Shell Companies, and Projections. For questions related to these amendments and rules, companies should continue to contact the individuals listed in the applicable rulemaking.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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