How to Prepare Form 20-F for 2024: A Guide for Securities Law in Corporate and Commercial Context
Are you gearing up for your 2024 annual report on Form 20-F? Well, we’ve got you covered with some key considerations to keep in mind! Whether you’re navigating disclosure developments or focusing on what the U.S. Securities and Exchange Commission (SEC) is honing in on, we’ve got the scoop.
One new hot topic for the 2024 Form 20-F is insider trading policies. Companies reporting on a calendar year basis are now required to follow the new insider trading policy and disclosure requirements outlined in Item 16J of Form 20-F. This rule change, adopted by the SEC in December 2022, mandates that companies disclose whether they have insider trading policies in place. If not, they need to explain why and file their policy as an exhibit to Form 20-F. These new disclosures are no joke – they will be subject to the Sarbanes-Oxley Act of 2002, meaning company execs will have to certify the accuracy of the statements made in Form 20-F.
But don’t fret – many companies have already filed their insider trading policy. Just remember, the policy must be an exhibit to Form 20-F, and the Item 16J disclosure in the Form’s body must be tagged in Inline XBRL.
Next up, an amended segment-reporting standard for FPIs reporting in U.S. GAAP. The Financial Accounting Standards Board (FASB) rolled out a final Accounting Standards Update in November 2023 to address investor requests for more detailed segment expenses info. While this update doesn’t apply to FPIs reporting in IFRS, those using U.S. GAAP will need to comply with the new guidelines for reporting segment information starting in annual periods after December 15, 2023. FASB has all the details on its website for those eager to learn more.
Lastly, let’s touch on the SEC’s disclosure focus areas. One key topic catching their eye is artificial intelligence (AI). The SEC has been stepping up its game in monitoring AI-related disclosures, aiming to prevent “AI washing” – aka making false or misleading claims about AI. This theme has been reinforced in speeches by top SEC officials, including the Chair and the directors of Enforcement and Corporation Finance Divisions. Stay tuned for more on this front!
So, there you have it – some juicy bits to keep in mind as you gear up for your 2024 Form 20-F. Stay tuned for more updates, and happy reporting!
