The Securities and Exchange Commission voted Wednesday to get rid of redundant and outmoded disclosures in response to recent changes in U.S. and international accounting standards and technology.
The SEC is also asking for comments from the public on some disclosure requirements that overlap with U.S. GAAP to decide whether to retain, modify, eliminate or refer them to the Financial Accounting Standards Board so changes can be incorporated in U.S. GAAP.
The move is part of the SEC’s effort to update and simplify corporate disclosure requirements to make them more useful to investors and less onerous for accountants. The SEC and FASB have been working to streamline the massive amount of disclosures that frequently show up as standard boilerplate text in many financial reports and prove to be of little use to anybody.
“The proposed amendments address outdated and redundant disclosure requirements while continuing to require companies to provide investors with what they need to make informed decisions,” said SEC chair Mary Jo White in a statement. “We are keenly interested in investors’ views on all aspects of the proposal and look forward to receiving their input as we continue to consider changes and enhancements to our disclosure requirements.”
The initiative is also part of the SEC’s task of implementing the Fixing America’s Surface Transportation Act, which Congress passed last December. Among other things, the FAST Act requires the SEC to eliminate provisions of Regulation S-K that are duplicative, overlapping, outdated or unnecessary.
The public comment period on the proposing release will remain open for 60 days once it appears in the Federal Register.
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