The Risks of Algorithm-Written MD&As

By Keren Bar-Hava July 16, 2025 by renholding

A subtle, yet potentially dangerous shift is underway in one of the most influential narrative sections of financial reports: the Management’s Discussion and Analysis (MD&A). Companies are increasingly crafting these disclosures not just for human shareholders or regulators, but for …

U.S. Supreme Court Considers Whether Pure Omissions Can Support Section 10(b) Liability

By Sarah Eichenberger and Jonathan Rotenberg February 12, 2024 by renholding

On January 16, 2024, the U.S. Supreme Court held oral argument on a question that could have significant consequences for securities litigants: whether a failure to disclose information under Item 303 of Regulation S-K is, standing alone, an actionable omission …

Does Context Matter in Interpreting Financial Information?

By Alex Kim and Valeri V. Nikolaev October 25, 2023 by renholding

The Management Discussion and Analysis (MD&A) section of annual reports is widely credited with providing valuable information about public companies. Yet largely unexplored is the extent to which narrative context influences and complements the numerical data presented in that section. …

Debevoise Discusses Supreme Court Case on Whether a Private Right of Action Exists for Deficient MD&A

By Matthew Kaplan, Maeve O’Connor, Jonathan Tuttle, Benjamin Pedersen and Anna Moody October 23, 2023 by renholding

The Supreme Court has agreed to hear an appeal relating to whether there is a private right of action for omissions from the disclosures required by Item 303 of Regulation S-K (i.e., Management’s Discussion and Analysis of Financial Condition and …

Can ChatGPT Help Investors Process Information?

By Alex G. Kim, Maximilian Muhn and Valeri Nikolaev June 19, 2023 by renholding

Since the launch of ChatGPT in November 2022, there’s been an exponential surge in the use of generative AI tools. Anecdotal evidence suggests that these tools are also of considerable interest to financial firms. As a case in point, Ken …

Debevoise & Plimpton Discusses SEC Guidance on Ukraine Disclosure Obligations

By Satish M. Kini, Paul M. Rodel, James C. Scoville, Robert T. Dura and Isabel Espinosa de los Reyes May 16, 2022 by renholding

On May 3, 2022, the Division of Corporation Finance (“CorpFin”) of the U.S. Securities and Exchange Commission (“SEC”) provided guidance to companies of their disclosure obligations with respect to the direct or indirect impact that Russia’s invasion of Ukraine and …

How Does Better Access to Public Firm Disclosures Affect IPO Firm Financing?

By Shawn Shi January 7, 2022 by renholding

Financial markets affect the economy in a fundamental way by facilitating the creation of capital. The market for initial public offerings (IPO) – also known as the “primary market” – is especially important because it allows fast-growing and innovative companies …

EBITDAC, Civil Liability, and New Paradigms

By Suprotik Das July 23, 2020 by renholding

COVID-19 has led companies to patch-up financial reporting by adding estimates of pre-COVID-19 profits to their EBITDA. Recently, COVID-19 prompted measuring-equipment manufacturer Schenck Process, for example, to add back €5.4 million, resulting in an adjusted EBITDA of €18.3 …

SEC Urges More Disclosure in First-Quarter Earnings Reports Amid the Pandemic

By Adam Fleisher, Sandra Flow, Nick Grabar, Jeffrey Karpf and David Lopez April 21, 2020 by hdh2120

The Securities and Exchange Commission and its senior staff have put out a succession of releases that combine some relief, some guidance and some warnings. The SEC Coronavirus (COVID-19) Response page is available here.

The latest in the series came …

Wachtell Lipton Discusses Disclosure Issues Relating to COVID-19

By Wachtell, Lipton, Rosen & Katz March 31, 2020 by renholding

Among the many issues facing public companies as a result of the COVID-19 pandemic is how to handle disclosure. The pandemic is having a material impact on most companies. While in a few cases the crisis may actually be increasing …

SEC Chair Clayton Offers “MD&A” for the Agency

By Jay Clayton April 9, 2019 by renholding

Disclosure and the concepts of materiality, comparability, flexibility, efficiency and responsibility have been, and continue to be, the bedrock principles that make our public capital markets the most fair and efficient markets in the world. Today, I will take a

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Gibson Dunn on SEC Simplification of Disclosure Requirements

By James Moloney, Hillary H. Holmes and Michael Titera April 2, 2019 by abirvarma

On March 20, 2019, the Securities and Exchange Commission (the “SEC”) voted to adopt amendments (available here) to modernize and simplify disclosure requirements for public companies, investment advisers, and investment companies (the “Final Rules”).[1] The amendments, which, among …

Financial Misconduct and Strategic Corporate Disclosures

By Rebecca Files, Alex Holcomb, Gerald S. Martin and Paul Mason October 9, 2018 by renholding

Financial misconduct can lead to significant financial and reputational penalties for a firm and its managers, including hefty fines from regulators and steep drops in stock price. In fact, recent research finds that firms accused of fraud lose an average …

Making Sustainability Disclosure Sustainable

By Jill E. Fisch September 10, 2018 by renholding

Issuers, investors, and regulators are paying increasing attention to corporate sustainability. Commentators have proffered a variety of explanations for this attention ranging from the argument that corporations are morally obligated to act in a socially responsible manner to the claim …

Financial Reporting Frequency

By Donald C. Langevoort August 27, 2018 by renholding

I should be a prime candidate to support the lengthening of the financial reporting cycle from three to six months, as the White House—and many others—now say they want the SEC to do. I want public corporations to be more …

Making a Market for Corporate Disclosure

By Kevin S. Haeberle and M. Todd Henderson May 23, 2018 by renholding

Public-company information has great social value. However, it is widely thought that left to their own devices, firms will under-disclose information about their condition and prospects. This thinking is embodied in the mandatory-disclosure regime that sits at the foundation of …

An Unasserted Lesson of the SEC’s Yahoo Cyberbreach Enforcement Action

By Stanley Keller May 10, 2018 by renholding

Much has been written about the Securities and Exchange Commission’s enforcement action involving Yahoo’s failure to adequately disclose a cyberbreach.[1] I am writing about something that the SEC’s announcement and order did not address and therefore has not been …

Cleary Gottlieb Discusses SEC’s Proposed Changes to Public Company Disclosure

By Nicolas Grabar, Jeffrey D. Karpf, Sandra L. Flow, Andrea M. Basham and Gaia Goffe October 24, 2017 by renholding

On October 11, 2017, the SEC proposed a collection of amendments to its rules and forms intended to modernize and simplify some of the disclosure requirements applicable to U.S. public companies.[1] The proposals would implement a statutory directive under …

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