10 Pa. Code § 609.034 - Financial statements
(a) If an
issuer proposes to register its securities for sale under section 205 or 206 of
the act (70 P.S. §§
1-205
and 1-206), and for which
securities a registration statement has been filed with the Securities and
Exchange Commission under section 5 of the Securities Act of 1933
(15 U.S.C.A. §
77e), the issuer shall:
(1) Comply with the financial statement
requirements as set forth in the rules and regulations of the Securities and
Exchange Commission ( 17 CFR
210.1-01-210.12-29 )
(relating to form and content of and requirements for financial statements,
Securities Act of 1933, Securities Exchange Act of 1934, Investment Company Act
of 1940, Investment Advisers Act of 1940, and Energy Policy and Conservation
Act of 1975).
(2) Prepare the
financial statements in accordance with generally accepted accounting
principles.
(3) Present the
financial statements in comparative form.
(b) Except as provided in subsection (d), an
issuer shall file the financial statements listed in subsection (c) if one of
the following conditions apply:
(1) The issuer
proposes to register its securities for sale under section 206 of the
act.
(2) The issuer proposes to
sell its securities under the exemption contained in Regulation A promulgated
under section 3(b) of the Securities Act of 1933 (15 U.S.C.A. §
77c(b)) and proposes to
register the securities under section 205 of the act.
(3) The issuer proposes to sell its
securities under the exemption contained in section 203(p) of the act
(70 P.S. §
1-203(p)).
(4) The issuer is required to file proxy
materials under section 203(o) of the act.
(c) If required under subsection (b), the
issuer shall file the following financial statements, prepared in accordance
with generally accepted accounting principles and presented in comparative
form:
(1) A balance sheet of the issuer, dated
within 120 days of the date of filing with the Department and comply with
either of the following requirements if the balance sheet is not audited:
(i) The issuer shall also file an audited
balance sheet as of the issuer's last fiscal year.
(ii) The issuer shall also file an audited
balance sheet as of the end of the issuer's next preceding fiscal year if the
issuer's last fiscal year ended within 90 days of the date of filing.
(2) Statements of income,
stockholders' equity and cash flows for each of 2 fiscal years or less, if the
issuer and its predecessors have been in existence for less than 2 years
preceding the date of the latest balance sheet filed, and for the period, if
any, between the close of the latest of the fiscal years and the date of the
latest balance sheet filed.
(i) These
statements shall be audited up to the date of the latest audited balance sheet
filed.
(ii) If changes in
stockholders' equity accounts are set forth in a note to the financial
statements, a separate statement of stockholders' equity does not need to be
filed.
(3) Consolidated
balance sheets, statements of income, stockholders' equity and cash flows
complying with the audit requirements in paragraphs (1) and (2) must be filed
for the issuer and its subsidiaries in accordance with this section.
(4) A balance sheet of the issuer before the
reorganization, a column showing the changes to be effected in the
reorganization, and a pro forma balance sheet after the reorganization if the
issuer is about to undergo a reorganization which will effect substantial
changes in its assets, liabilities or capital accounts.
(i) The issuer shall explain in a footnote
the adjustments made.
(ii) If a
reorganization has taken place at any time covered by the statements of income
filed, the issuer shall explain in a footnote the effect of the
reorganization.
(5) A
description of the plan of succession, showing in columnar form, the balance
sheets of the parties to the transaction, the changes effected or to be
effected and the balance sheet of the issuer as a result of the transaction,
and statements of income for each of the businesses for the periods covered by
paragraph (2), to include a consolidating pro forma statement of income if the
issuer has succeeded, or is about to succeed, to one or more businesses, by
merger, consolidation or otherwise. This paragraph does not apply to the
issuer's succession to the business of any totally-held subsidiary or to the
acquisition of subsidiaries not constituting, in the aggregate, a significant
subsidiary.
(6) Financial
statements for the business as would be required if it were an issuer if the
issuer has acquired any business (or the securities of any person giving the
issuer control over the person) after the date of its latest balance sheet
filed under paragraph (1), or if the issuer proposes to acquire those types of
business or securities.
(i) The issuer shall
also file pro forma statements of income in columnar form.
(ii) The acquisition of securities which will
extend the issuer's control over another person is considered the acquisition
of a business if the securities being registered under section 206 of the act
are to be offered for the securities to be acquired, or if the purpose of the
proxy statement is to effectuate the acquisition.
(iii) Financial statements do not need to be
filed under this paragraph for any acquisition from a totally-held
subsidiary.
(iv) Statements of
businesses may be omitted if, considered in the aggregate as a single
subsidiary, they would not constitute a significant subsidiary, except that the
statements may not be omitted when the securities being registered under
section 206 of the act are to be offered in exchange for the securities to be
acquired, or if the purpose of the proxy statement is to effectuate the
acquisition.
(7) The
registration statement with summary statements for each of the 3 most recent
fiscal years and for the period from the date of the end of the latest fiscal
year to the date of the latest balance sheet filed if an issuer proposes to
register its securities under section 206 of the act. The summary statements of
income required in this paragraph are in addition to the financial statements
required under paragraph (2).
(d) If an issuer proposes to register its
equity securities for sale under section 206 of the act, which securities are
exempt from registration under section 5 of the Securities Act of 1933 under an
exemption contained in section 3(a)(11) of the Securities Act of 1933, or
Regulation A or Rule 504 of Regulation D promulgated under section 3(b) of the
Securities Act of 1933, the issuer shall file the financial statements required
under subsection (c) except that the financial statements may be reviewed by an
independent certified public accountant in accordance with the standards
established by the American Institute of Certified Public Accountants or the
Canadian equivalent if:
(1) The amount of the
present offering does not exceed $1 million.
(2) The issuer previously has not sold
securities through an offering involving the general solicitation of
prospective investors by means of advertising, mass mailings, public meetings,
"cold call" telephone solicitation or any other method directed toward the
public.
(3) The issuer previously
has not been required under Federal, State, provincial or territorial
securities laws to provide audited financial statements in connection with any
sale of its securities.
(4) The
aggregate amount of all previous sales of securities by the issuer (exclusive
of debt financing with banks and similar commercial lenders) does not exceed $1
million.
(e) The
financial statements required under subsections (c) and (d) must be included in
the prospectus or offering circular distributed to offerees in this
Commonwealth.
(f) For purposes of
this subsection, the Department used the corporate form of financial statement
title, but because financial statement title terminology may differ for other
types of accounting entities, including nonprofit organizations, those entities
shall include the analogous financial statements.
(g) If consistent with the protection of
investors, the Department may:
(1) Permit the
omission of one or more of the financial statements required under this section
or the filing in substitution of appropriate statements of comparable
character.
(2) Require the filing
of other financial statements in addition to, or in substitution for, the
financial statements required under this section or when the financial
statements are necessary for an adequate presentation of the financial
condition of the issuer.
(h) Subsections (b)(2) and (c) do not apply
when an issuer offers or sells a security in an offering exempt from
registration with the Securities and Exchange Commission under Tier 2 of
Regulation A adopted under the Securities Act of 1933 (15 U.S.C.A. §§
77a-77aa) in good faith reliance on
section 203(u) of the act.
Notes
The provisions of this § 609.034 issued under the Pennsylvania Securities Act of 1972 (70 P.S. §§ 1-101-1-704); amended under sections 202(g) and (i), 203(d), (i.1), (j) and (n)-(t), 204(a), 205(b), 207(g), (j.1) and (n), 209(b), 211(a) and (b), 504(d), 513, 603(a), 606(d) and 609(a) of the Pennsylvania Securities Act of 1972 (70 P.S. §§ 1-202(g) and (i), 1-203(d), (i.1), (j) and (n)-(t), 1-204(a), 1-205(b), 1-207(g), (j.1) and (n), 1-209(b), 1-211(a) and (b), 1-504(d), 1-513, 1-603(a), 1-606(d) and 1-609(a)); section 202.C of the Department of Banking and Securities Code (71 P.S. § 733-202.C); and section 9(b) of the Takeover Disclosure Law (70 P.S. § 79(b)).
State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.
No prior version found.