SEC Releases Final Rule No. 33-9002

The SEC Releases Final Rule No. 33-9002, on January 30, 2009, Requiring Companies to Submit Financial Statements in XBRL Format with Their SEC Filings.

February 25, 2009

The final rule release requires companies to provide financial statement information in the eXtensible Business Reporting Language (“XBRL”) and is the result of an effort the SEC began years ago to make financial reports more useful to investors.

Under the rule, companies are required to submit their regulatory filings to the SEC and post them on their corporate websites in interactive data using XBRL. The interactive data will be provided as an exhibit to periodic and current reports and registration statements, as well as to transition reports for a change in fiscal year.

With XBRL, financial statement information may be downloaded directly into spreadsheets, analyzed in a variety of ways using commercial off-the-shelf software, and used within investment models.

The new rules will require companies to provide financial information using interactive data beginning with their quarterly June 2009 filings for the largest companies, and within three years for all public companies.

The three year phase-in schedule beginning with fiscal periods ending on or after June 15, 2009 is as follows:

Year 1 - rules apply only to domestic and foreign large accelerated filers that use U.S. GAAP and have a worldwide public float above $5 billion.
Year 2 - all other domestic and foreign large accelerated filers using U.S. GAAP would be subject to interactive data reporting.
Year 3 - all remaining filers using U.S.GAAP, including smaller reporting companies, and all foreign private issuers that prepare their financial statements in accordance with IFRS as issued by the IASB would be subject to the same interactive data reporting requirements.

Rowbotham & Company LLP is helping affected companies to understand what XBRL requirement means for them and to implement measures to get them ready for when the new rules begin to take effect. Please contact Mark Kelly or Kenneth Lee at Rowbotham & Company LLP for further questions.

PCAOB Registration of Auditors of Non-Public Broker-Dealers Required

Beginning in August 2003, the Securities and Exchange Commission issued a series of orders granting temporary exemptions to non-public broker-dealers from the obligation to file financial statements under Section 17(e) of the Exchange Act that have been audited by a registered public accounting firm. The latest order, issued on December 12, 2006, extended the exemption to cover financial statements for fiscal years ending before January 1, 2009 (Exchange Act Release No. 54920, http://www.sec.gov/rules/other/2006/34-54920.pdf).

As a result of the expiration of the exemption, the audits required under Exchange Act Section 17(e) for fiscal years ending after December 31, 2008 must be performed by an accounting firm that is registered with the PCAOB.

Rowbotham & Company LLP is a PCAOB registered accounting firm and has been assisting many Non-Public Broker-Dealers in their professional services needs. Please contact Mark Kelly or Harriet Leung at Rowbotham & Company LLP for further questions.