The decision to add a 'phase-in' period for quarterly forms (10-Q) and annual forms (10-K) over a three-year period, beginning late 2003, marked a communications victory for the business, legal, and accounting groups who had been lobbying the SEC to find a way to mitigate the proposed regulation.
The original rule, which was first tabled in April, would have accelerated annual reports from 90 to 60 days and quarterly reports from 45 to 30 days, with no phase-in periods and was touted as part of the SEC's move toward 'current disclosure'.
The SEC received an unprecedented amount of negative reaction to the originally proposed rule from many in the business community.
Among the chief complaints was that the proposed rule change was too onerous to thrust upon corporations within such a short period of time.
During a recent SEC meeting, chairman Harvey Pitt referred to the volume of complaints. 'I must say you have established a new world record for the most negative comments received on a rule proposal,' he said. 'I ask that you not take it personally.'
The deadline for filing annual reports following the close of a company's fiscal year will stay at 90 days for one year and change to 75 days in year two, then indefinitely change to 60 days in year three.
Deadlines for quarterly reports similarly will remain at 45 days for the first year, changing to 40 days in the second year, and then 35 days in the third year.
The first deadline contractions would occur for companies with fiscal years ending on or after 15 December, 2003.