The US Securities and Exchange Commission has been more visible recently in challenging and even charging companies for errors in the disclosures they have included in filings and other reports to shareholders.
While the issue of material cyber breaches and ESG reports has been in the news, companies need to make sure they have reasonable assurance that everything in their filings and other communications is complete, accurate, timely, and complies with any related regulatory requirements.
Company chief executives and chief financial officers are required to certify that their “disclosure controls” are adequate by Section 302 of the Sarbanes-Oxley Act.
The SEC explained (with my highlights):
As adopted, new Exchange Act Rules 13a-14 and 15d-14[1] require an issuer’s principal executive officer or officers and the principal financial officer or officers, or persons performing similar functions, each to certify in each quarterly and annual report, including transition reports, filed or submitted by the issuer under Section 13(a) or 15(d) of the Exchange Act[2] that:
- he or she has reviewed the report;
- based on his or her knowledge, the report does not contain any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements made, in light of the…
