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Guidelines for SEC Filing: What to do

By: Ivan Marx Olarte, CPA

 

 

The Securities and Exchange Commission (SEC) aims to maintain an organized filing of the Annual Financial Statements (AFS) pursuant to the authority granted by the Corporation Code and Securities Regulation Code. Recently, SEC issued Memorandum Circular (MC) No. 1-2019, which provides guidelines for the filing of the AFS and General Information Sheet (GIS).

 

Submission of AFS

 

SEC requires all registered corporations, including branch offices, representative offices, regional headquarters and regional operating headquarters of a foreign operations to submit their AFS. Under the SRC Rule 68 and 68.1 as amended, together with the Citizens Manual on Reportorial Requirements published by SEC, the AFS must be accompanied by the following:

  • Independent auditor’s report for:
    • Stock corporations with paid up capital of P50,000 or more; or
    • Non-stock corporations with annual gross receipts of P100,000 or more, or total assets of P500,000 or more;
  • If the above threshold is not met, certification under oath by the corporate treasurer; and,
  • Statement of Management’s Responsibility for Financial Statements.

 

Failure to comply with the above requirements puts the corporation at risk of incurring penalties with the SEC.

 

The AFS shall be submitted to SEC after it is stamped “received” by the Bureau of Internal Revenue. This procedure applies to all AFS other than the consolidated financial statements. The deadline for submission of the annual financial statements shall depend on the last numerical digit of the SEC registration or license number, as follows:

  • April 22-26 for corporations with registration number ending in 1 or 2;
  • April 29,30, May 2-3 for corporations with registration number ending in 3 or 4;
  • May 6-10 for corporations with registration number ending in 5 or 6;
  • May 20-24 for corporations with registration number ending in 7 or 8; and
  • May 27-31 for corporations with registration number ending in 9 or 0;

 

Please note that registered corporations may submit their AFS earlier than the dates set above without regard to the last numerical digit of their registration.

 

Also, the deadlines set above pertains to corporations with fiscal year ending December 31. Corporations with fiscal year end other than December 31 must file their AFS within 120 days from the end of the fiscal year.

 

Submission of GIS

 

The SEC also issued MC 17-2018 which revises the format of the GIS to include disclosure of beneficial ownership. The new GIS format shall be used beginning January 1, 2019. This can be downloaded in the SEC website.

 

 

All corporations are required to file their GIS within 30 days from:

  • Date of actual annual stockholders’ meeting for stock corporation;
  • Date of actual annual members’ meeting for non-stock corporation; and
  • Anniversary date of issuance of SEC License for foreign corporations.

 

However, should there be no actual meeting during the year, the GIS shall be filed on January 30.

 

Summary

 

If anything, the only significant change in filing the AFS and GIS is only the revision of the GIS. Let us always keep abreast of the relevant updates, so we can comply correctly. Correct compliance will always save us a lot of time and likewise prevent incurrence of unwanted penalties.