Section 1 Short title
This Act may be cited as the “Small Company Disclosure Simplification Act”.
Small Company Disclosure Simplification Act
A BILL
To exempt smaller public companies from requirements relating to the use of Extensible Business Reporting Language for periodic reporting to the Securities and Exchange Commission, and for other purposes.
Sec. 2 Exemption from XBRL requirements for emerging growth companies and other smaller companies
Exemption for emerging growth companies— Emerging growth companies are exempted from the requirements to use Extensible Business Reporting Language (XBRL) for financial statements and other periodic reporting required to be filed with the Commission under the securities laws. Such companies may elect to use XBRL for such reporting.
Exemption for other smaller companies— Issuers with total annual gross revenues of less than $250,000,000 are exempt from the requirements to use XBRL for financial statements and other periodic reporting required to be filed with the Commission under the securities laws. Such issuers may elect to use XBRL for such reporting. An exemption under this subsection shall continue in effect until—
the date that is five years after the date of enactment of this Act; or
the date that is two years after a determination by the Commission, by order after conducting the analysis required by section 3, that the benefits of such requirements to such issuers outweigh the costs, but no earlier than three years after enactment of this Act.
Modifications to regulations— Not later than 60 days after the date of enactment of this Act, the Commission shall revise its regulations under parts 229, 230, 232, 239, 240, and 249 of title 17, Code of Federal Regulations, to reflect the exemptions set forth in subsections (a) and (b).
Sec. 3 Analysis by the SEC
The Commission shall conduct an analysis of the costs and benefits to issuers described in section 2(b) of the requirements to use XBRL for financial statements and other periodic reporting required to be filed with the Commission under the securities laws. Such analysis shall include an assessment of—
how such costs and benefits may differ from the costs and benefits identified by the Commission in the order relating to interactive data to improve financial reporting (dated January 30, 2009; 74 Fed. Reg. 6776) because of the size of such issuers;
the effects on efficiency, competition, capital formation, and financing and on analyst coverage of such issuers (including any such effects resulting from use of XBRL by investors);
the costs to such issuers of—
submitting data to the Commission in XBRL;
posting data on the website of the issuer in XBRL;
software necessary to prepare, submit, or post data in XBRL; and
any additional consulting services or filing agent services;
the benefits to the Commission in terms of improved ability to monitor securities markets, assess the potential outcomes of regulatory alternatives, and enhance investor participation in corporate governance and promote capital formation; and
the effectiveness of standards in the United States for interactive filing data relative to the standards of international counterparts.
Sec. 4 Report to Congress
Not later than one year after the date of enactment of this Act, the Commission shall provide the Committee on Financial Services of the House of Representatives and the Committee on Banking, Housing, and Urban Affairs of the Senate a report regarding—
the progress in implementing XBRL reporting within the Commission;
the use of XBRL data by Commission officials;
the use of XBRL data by investors;
the results of the analysis required by section 3; and
any additional information the Commission considers relevant for increasing transparency, decreasing costs, and increasing efficiency of regulatory filings with the Commission.
Sec. 5 Definitions
As used in this Act, the terms Commission, emerging growth company, issuer, and securities laws have the meanings given such terms in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c).