Posted on Friday, September 11, 2020

The Securities and Exchange Commission (SEC) published the final rule for Update of Statistical Disclosures for Bank and Savings and Loan Registrants. The rule amends disclosures required to be reported, and codifies certain disclosures in a new Subpart 1400 of Regulation S-K. The original proposed rule asked whether the disclosures should be included in the notes to the financial statements and whether they should be required to be reported in structured format. Today, these disclosures can be included in Management’s Discussion & Analysis (MD&A), in the Business section, or in the notes to the financial statements. Although the XBRL US response to the proposal supported the use of standards for these disclosures to improve consistency and usability, the SEC final rule does not require registrants to include Item 1400 of Regulation S-K disclosures to be placed in a specified location.

The SEC rule states “…retaining flexibility as to where to provide the disclosures is important and will allow registrants to use their judgment to determine where the disclosures can best be included to maximize the readability and usefulness of the disclosure. We are cognizant of the additional costs that would be incurred if the disclosures were required to be included in the notes to the financial statements, and we believe investors are accustomed to locating this information in different locations within SEC filings given the current flexibility as to where to include the disclosures. As discussed above, we received mixed comments regarding the benefits, costs and practical challenges of requiring the proposed disclosures in a machine readable format. Therefore, like the proposed rules, the final rules do not require a registrant to present new Subpart 1400 of Regulation S-K in a machine-readable format unless the registrant elects to include the disclosures within the financial statements. “

Read the final rule.