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SEC wants companies to boost disclosures

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Nov 13, 2018

On November 13, 2018, the Wall Street Journal (WSJ) published an article on how the SEC wants companies to ramp up the level of disclosure surrounding the risks posed by cybersecurity, Brexit and the planned phaseout of the London interbank offered rate.

The SEC issued new cybersecurity disclosure guidance earlier this year, and the regulator wants companies to align their current disclosure policies with that guidance. That means including in corporate filings discussions of board risk oversight, disclosure controls and procedures, and insider trading policies as they relate to cybersecurity.

Risks related to the U.K.’s exit from the European Union are another area in which the SEC is looking for additional detail in corporate filings. Negotiators for Britain and the EU reached a draft deal for the divorce on Tuesday, but British Prime Minister Theresa May must now rally her deeply divided cabinet behind this proposal.

The planned transition away from Libor, which financial regulators expect to complete by the end of 2021, is another topic corporate accountants should consider when preparing disclosures for compiling financial filings. There are significant uncertainties surrounding legacy financial instruments that rely on Libor and how the switch to another benchmark for these instruments may affect the reporting company’s hedge accounting.

Review the full article on the WSJ's website.

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