{"id":1377,"date":"2018-10-29T09:53:23","date_gmt":"2018-10-29T13:53:23","guid":{"rendered":"https:\/\/seci.wpenginepowered.com\/?p=1377"},"modified":"2018-10-29T09:53:23","modified_gmt":"2018-10-29T13:53:23","slug":"disclosure-update-and-simplification-a-welcome-change-for-debt-issuers","status":"publish","type":"post","link":"https:\/\/seciblog.pli.edu\/index.php\/disclosure-update-and-simplification-a-welcome-change-for-debt-issuers\/","title":{"rendered":"Disclosure Update and Simplification \u2013 A Welcome Change for Debt Issuers"},"content":{"rendered":"<p>The SEC\u2019s required disclosure of the ratio of earnings to fixed charges has been a sometimes overly complex disclosure of questionable use.\u00a0 And, as the SEC noted on page 57 of the <a href=\"https:\/\/www.sec.gov\/rules\/final\/2018\/33-10532.pdf\">Disclosure Simplification and Update Final Rule<\/a>:<\/p>\n<p style=\"padding-left: 30px;\">\u201cOther ratios that accomplish similar objectives include other variations of the ratio of earnings to fixed charges, the interest coverage ratio, and the debt-service coverage ratio, which can be calculated based on information readily available in the financial statements.\u201d<\/p>\n<p>The <a href=\"https:\/\/www.sec.gov\/rules\/final\/2018\/33-10532.pdf\">Disclosure Update and Simplification Rule<\/a>\u00a0eliminated this disclosure.<\/p>\n<p>The starting point for the change is in Regulation S-K Item 503, where paragraph (d) and all the related instructions were eliminated:<\/p>\n<p style=\"padding-left: 30px;\"><span style=\"text-decoration: line-through;\">(d) Ratio of earnings to fixed charges. If you register debt securities, show a ratio of earnings to fixed charges. If you register preference equity securities, show the ratio of combined fixed charges and preference dividends to earnings. Present the ratio for each of the last five fiscal years and the latest interim period for which financial statements are presented in the document. If you will use the proceeds from the sale of debt or preference securities to repay any of your outstanding debt or to retire other securities and the change in the ratio would be ten percent or greater, you must include a ratio showing the application of the proceeds, commonly referred to as the pro forma ratio. <\/span><\/p>\n<p>The title of S-K Item 503 was also changed:<\/p>\n<p style=\"padding-left: 30px;\"><strong>(Item 503) Prospectus summary<span style=\"text-decoration: line-through;\">,\u00a0<\/span><u>and <\/u>risk factors<span style=\"text-decoration: line-through;\">, and ratio of earnings to fixed charges<\/span>.<\/strong><\/p>\n<p>Along with these changes the SEC made other adjustments to eliminate this disclosure from the Exhibits in S-K Item 601 and from all the related forms (particularly Form 20-F) which had included this ratio.<\/p>\n<p>As always, your thoughts and comments are welcome!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The SEC\u2019s required disclosure of the ratio of earnings to fixed charges has been a sometimes overly complex disclosure of questionable use.\u00a0 And, as the SEC noted on page 57 of the Disclosure Simplification and Update Final Rule: \u201cOther ratios that accomplish similar objectives include other variations of the ratio of earnings to fixed charges, &hellip; <a href=\"https:\/\/seciblog.pli.edu\/index.php\/disclosure-update-and-simplification-a-welcome-change-for-debt-issuers\/\" class=\"more-link\">Continue reading <span class=\"screen-reader-text\">Disclosure Update and Simplification \u2013 A Welcome Change for Debt Issuers<\/span> <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":9,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[1],"tags":[],"coauthors":[154],"class_list":["post-1377","post","type-post","status-publish","format-standard","hentry","category-uncategorized"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_sharing_enabled":true,"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts\/1377","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/comments?post=1377"}],"version-history":[{"count":0,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/posts\/1377\/revisions"}],"wp:attachment":[{"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/media?parent=1377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/categories?post=1377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/tags?post=1377"},{"taxonomy":"author","embeddable":true,"href":"https:\/\/seciblog.pli.edu\/index.php\/wp-json\/wp\/v2\/coauthors?post=1377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}