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Although the Dodd-Frank Act did not require the SEC to mandate clawbacks in the context of little r restatements, the SEC previously expressed concern that excluding little r restatements from the scope of the rules might encourage opportunistic behavior by companies when choosing between a Big R and little r restatement. Partner, Accounting Advisory Services, KPMG US, Director, Accounting Advisory Services, KPMG US. endstream endobj 122 0 obj <>/Metadata 26 0 R/PageLayout/OneColumn/Pages 25 0 R/StructTreeRoot 28 0 R/Type/Catalog>> endobj 123 0 obj <>/Font<>/XObject<>>>/Rotate 0/StructParents 0/Type/Page>> endobj 124 0 obj <> endobj 125 0 obj <> endobj 126 0 obj <> endobj 127 0 obj <>stream Support for deal-related accounting challenges. PDF Listing Standards for Recovery of Erroneously Awarded Compensation Your email address will not be published.*. Yet, in recent years the number of misstatements corrected in restatements of financial reports has declined dramatically, and misstatements are now more likely to be corrected in less formal revisions of those reports.Based on materiality guidance, prior years' financial statements of . Following the restatement, the amount of the award based on the corrected financial reporting measure is $1,800. Non-equity incentive plan awards that are earned based wholly or in part on satisfying a financial reporting measure performance goal; Bonuses paid from a bonus pool, the size of which is determined based wholly or in part on satisfying a financial reporting measure performance goal; Other cash awards based on satisfaction of a financial reporting measure performance goal; Restricted stock, restricted stock units, performance share units, stock options, and stock appreciation rights that are granted or become vested based wholly or in part on satisfying a financial reporting measure performance goal; and. 0000273083 00000 n Many in the accounting profession pay close attention to the comments made by the panelists from the SEC and FASB staffs in the hopes of getting a glimpse of what might be the focus of regulators in the upcoming earnings season. Munter noted that Little r restatements have grown from 35% of restatements in 2005 to nearly 76% last year. Moreover, the final rules prohibit issuers from insuring or indemnifying any executive officer or former executive officer against the loss of erroneously awarded compensation. Each December, the AICPA and CIMA Conference on Current SEC and PCAOB Developments1 provides an update on the latest accounting and reporting issues affecting SEC registrants and their auditors. <<5AFFD3652592DC4CB97C69C29A98C1DB>]/Prev 478290/XRefStm 1433>> Identify critical data requirements, establish legally credible retention processes, and align records to help business to be conducted more efficiently. 0000001433 00000 n It is important to note that Rule 10D-1 sets a baseline floor for minimum requirements that a clawback policy must meet, but does not prevent an issuer from adopting policies that would provide for recovery of compensation from individuals and in situations not specifically required by Rule 10D-1.