The criteria the SEC staff considers when determining whether a “de-pooling” is acceptable in an initial registration as found in SAB Topic 5. However, in limited circumstances involving the initial registration of a reporting entity under the Exchange Act or Securities Act, the SEC staff has not objected to financial statements that retrospectively reflect the reorganization of the business as a change in the reporting entity if the spin-off transaction occurs prior to effectiveness of the registration statement.
If the parent reporting entity was required to file periodic reports under the 1934 Exchange Act within one year prior to the spin-off, the SEC staff believes the reporting entity should reflect the disposition as held for sale in conformity with ASC 360 as this presentation most fairly and completely depicts for investors the effects of the previous and current organization of the reporting entity. The SEC generally will not allow a parent reporting entity to retrospectively adjust its financial statements to reflect a spin-off as a change in the reporting entity (i.e., sometimes referred to as a “de-pooling”). Transfers and servicing of financial assets Revenue from contracts with customers (ASC 606) Loans and investments (post ASU 2016-13 and ASC 326) Investments in debt and equity securities (pre ASU 2016-13) Insurance contracts for insurance entities (pre ASU 2018-12) Insurance contracts for insurance entities (post ASU 2018-12) Dominic Diongson Updated: 9:33 PM EDT Original: Investors often review a companys free cash flow before deciding whether to buy a stake. IFRS and US GAAP: Similarities and differences Operating cash flow is different from free cash flow (FCF), the cash that a company generates after accounting for operations and other cash outflows. Business combinations and noncontrolling interestsĮquity method investments and joint ventures
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