COVID-19 in Q2 Reporting – What the SEC Is Looking For

On June 30, 2020, SEC Chairman Jay Clayton moderated a virtual roundtable titled, “Q2 Reporting: A Discussion of COVID-19 Related Disclosure Considerations.”

He was joined by Corporation Finance Director Bill Hinman and a high-powered panel, who commented on what they hope issuers will disclose about the impact of COVID-19 and a wide range of other topics.

The roundtable follows a succession of recent statements from the SEC about what issuers should be addressing.  In this memo, we will summarize some themes from the roundtable and highlight a few key points about preparing disclosure in these uncertain times.

In a separate memo published today, we explore some challenges companies face in seeking to quantify the effects of COVID-19 on their financial performance.  We have also attached as Annex A to this memo a practical checklist of disclosure topics an issuer should consider in considering whether it has adequately addressed COVID-19 in its second-quarter disclosures.

The panel for the June 30 Roundtable was well placed to speak about what investors wish for from corporate disclosures in these difficult times. They were:

• Gary Cohn – now a venture capitalist, Mr. Cohn was director of the National Economic Council in 2017-18, and previously Chief Operating Officer of Goldman Sachs
• Glenn Hutchins – Mr. Hutchins is a leading figure in private equity, chairman of North Island and co-founder of Silver Lake Partners
• Tracy Maitland – Mr. Maitland is the founder and Chief Investment Officer at investment management firm Advent Capital Management
• Barbara Novick – a co-founder and the Vice-Chairman of BlackRock, Ms. Novick oversees its investment stewardship team

Please click here to read the full alert memorandum.