Determination of EGC status.

Confidential review of EGC registration statements and EDGAR publication of related SEC comment letters.

General financial disclosure accommodations available to EGCs.

Extended transition period available to EGCs for complying with new or revised accounting standards.

ABS Issuers and Registered Investment Companies Do Not Qualify as EGCs. Given the existing regulatory regimes for asset-backed securities (ABS) issuers and registered investment companies, and given the definition of EGC under the JOBS Act, the staff does not believe that ABS issuers or registered investment companies qualify as EGCs (Questions 19 and 20, May 3 FAQs).

Business Development Companies May Qualify as EGCs. The staff believes that business development companies, a category of closed-end investment companies that are not required to register under the Investment Company Act but are regulated under Sections 55 through 65 of that Act, may qualify as EGCs (Question 21, May 3 FAQs).

An Issuer That Has Issued Registered Debt But Not Equity Securities May Qualify as an EGC. A company that has issued registered debt securities but not equity securities may qualify as an EGC if it had annual total gross revenues under $1 billion for its most recent fiscal year and none of the disqualifying conditions under the EGC definition have been triggered (Question 29, May 3 FAQs).

Succeeding to the Exchange Act Registration and Reporting Obligations of a Non-EGC Predecessor. If an issuer completes a transaction that results in its succession to the Exchange Act registration and reporting obligations of its predecessor under Exchange Act Rules 12g-3 and 15d-5, the successor is not eligible to be an EGC if the predecessor was ineligible for EGC status because its first registered sale of common equity securities occurred on or before December 8, 2011 (Question 24, May 3 FAQs).

$1 Billion Total Annual Gross Revenue Test Applies Only to the Most Recently Completed Fiscal Year. A company meets the total annual gross revenues test for the definition of EGC if its total annual gross revenues were less than $1 billion for the most recently completed fiscal year (for example, the fiscal year ended December 31, 2011). This is true even if the company's total annual gross revenues were greater than $1 billion two or more years ago (for example, for the fiscal year ended December 31, 2010 or for earlier years) (Question 22, May 3 FAQs).

Financial Institutions Should Include All Gross Revenues from Traditional Banking Activities in Calculating Total Annual Gross Revenues. In calculating its total annual gross revenues for purposes of determining EGC status, a financial institution should include all gross revenues from traditional banking activities. This is the same calculation method a financial institution must use when calculating revenues for purposes of determining smaller reporting status, as set out in Section 5110.2(c) of the Division of Corporation Finance's Financial Reporting Manual (Question 23, May 3 FAQs).

Determining the Date that EGC Status Is Lost After the Fifth Anniversary of the First Sale of Common Equity Securities. Under Securities Act Section 2(a)(19)(B), an issuer loses its EGC status on the "last day of the fiscal year of the issuer following the fifth anniversary of the date of the first sale of common equity securities pursuant to an effective registration statement." The date that EGC status is lost is determined by looking to the fiscal year during which the fifth anniversary occurs. For example, if a company with a December 31 fiscal year-end completed its IPO on May 2, 2012, it would cease to be an emerging growth company no later than December 31, 2017 (Question 40, May 3 FAQs).

Debt Securities Issued in an A/B Exchange Offer Do Not Count Towards $1 Billion Debt Limit. Debt securities issued in an A/B exchange offer need not be counted towards the three-year rolling $1 billion limit on non-convertible debt securities in Section 2(a)(19)(C) of the Securities Act for purposes of determining whether a company has lost its EGC status (Question 18, May 3 FAQs).

An Issuer that Conducts an IPO as an EGC and Later Loses EGC Status Cannot Later Regain EGC Status. An issuer that conducts its first SEC-registered sale of common equity securities as an EGC and later loses its EGC status under one of the four disqualifying conditions under Section 2(a)(19) of the Securities Act cannot later regain EGC status (Question 32, May 3 FAQs).

An EGC May Submit for Confidential Review a Registration Statement for an A/B Debt Exchange Offer on Form S-4 or Form F-4. If its IPO date has not yet occurred, an EGC may use the confidential submission process to submit a draft registration statement for an A/B debt exchange offer on Form S-4 or Form F-4 (Question 31, May 3 FAQs).

Restatement Disclosures for EGCs Restating Their Financial Statements While in Confidential Review. An EGC that restates its financial statements while its registration statement is in confidential review must continue to include the required restatement disclosures until its financial statements are updated for the next annual period (Question 38, May 3 FAQs). This is consistent with the restatement disclosure requirement in the context of a publicly filed registration statement.

SEC Comment Letters and Response Letters Relating to Confidentially Reviewed Draft Registration Statements Will be Published on EDGAR. The staff will publicly release its comment letters and related issuer response letters on EDGAR no earlier than 20 business days following the effective date of a registration statement (the same time frame that applies to publicly filed registration statements). To assist in this process, the staff will ask EGCs to resubmit their response letters via EDGAR using the submission type "CORRESP" at the time of the first public filing of the registration statement on EDGAR (Question 25, May 3 FAQs).

Procedures for Confidential Treatment Requests for EGCs in Confidential Review. When responding to staff comments on a confidential draft registration statement, an EGC should appropriately identify in its response letters the information for which it intends to seek permanent confidential treatment, to ensure the staff does not include that information in its comment letters when later published on EDGAR. When the EGC resubmits its responses to staff comments together with its initial filing of the draft registration statement on EDGAR, it should follow the procedures outlined in Rule 83 of the SEC's Rules of Practice (see Filing a Confidential Treatment Request Checklist). Alternatively, the company could follow the Rule 83 procedures at the time it first submits its response letters to the staff (Question 26, May 3 FAQs).

EGCs Must Comply with XBRL Requirements. Title I of the JOBS Act does not exempt EGCs from the requirement to file certain financial information with the SEC in eXtensible Business Reporting Language (XBRL) format (Question 28, May 3 FAQs).

An EGC Must Include Three Years of Audited Financial Statements in its Annual Report on Form 10-K or Form 20-F. Unless it is a smaller reporting company, an EGC must include three years of audited financial statements in its annual report on Form 10-K or Form 20-F. An EGC is not required to include, in its first annual report on Form 10-K or Form 20-F, audited financial statements for any period before the earliest audited period presented in connection with its IPO. For example, if an EGC with a December 31 fiscal year-end has an IPO registration statement declared effective during the 3rd quarter of 2012, the registration statement would include audited financial statements for 2011 and 2010. The EGC's first annual report, which will be for the fiscal year ending December 31, 2012 and will be filed in 2013, will include audited financial statements covering 2012, 2011 and 2010 (Question 30, May 3 FAQs).

An EGC May Not Comply with the Smaller Reporting Company (SRC) Requirements for MD&A Disclosure Unless it Qualifies as an SRC. While Section 102(c) of the JOBS Act permits an EGC to comply with the smaller reporting company (SRC) version of Item 402 of Regulation S-K (relating to certain executive compensation disclosure requirements), it does not permit an EGC to comply with the SRC provisions of Item 303 of Regulation S-K (relating to Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) disclosure requirements). Instead, Section 102(c) permits an EGC to limit the discussion in its MD&A to only those audited periods presented in its audited financial statements. Accordingly, if in its IPO registration statement an EGC includes only two years of audited financial statements, as permitted by new Section 7(a) of the Securities Act, then the company can limit its MD&A discussion to those two years (Question 41, May 3 FAQs).

EGCs May be Entitled to Scaled Disclosure Requirements for the Ratio of Earnings to Fixed Charges. For certain offerings, Item 503(d) of Regulation S-K requires issuers that are not SRCs to present their ratio of earnings to fixed charges for each of the last five fiscal years and the latest interim period for which financial statements are presented in the registration statement. While Title I does not address the ratio of earnings to fixed charges disclosure requirement, an EGC is permitted to present in a registration statement its ratio of earnings to fixed charges for the same number of years for which it provides selected financial data under Title I of the JOBS Act (Question 27, May 3 FAQs).

Title I Does Not Change the Number of Years of Financial Statements Required for Compliance with IFRS. Under International Financial Reporting Standards (IFRS) 1, First-time Adoption of International Financial Reporting Standards, a first-time adopter of IFRS must present an opening IFRS statement of financial position at the date of transition to IFRS. This requirement results in the presentation of three statements of financial position. Likewise, a foreign private issuer (FPI) that is not a first-time adopter of IFRS is required by International Accounting Standards (IAS) 1, Presentation of Financial Statements, to provide three statements of financial position when it applies an accounting policy retrospectively, makes a retrospective restatement or reclassifies items in its financial statements. While Title I permits an EGC to include only two years of audited financial statements in its IPO registration statement, for an FPI to assert that its financial statements are prepared in compliance with IFRS as issued by the International Accounting Standards Board (IASB), it must include three statements of financial position when required as described above (Question 39, May 3 FAQs).

"New or Revised" Accounting Standards Means any Update to the FASB Accounting Standards Codification after April 5, 2012. The term "new or revised" financial accounting standard refers to any update issued by the Financial Accounting Standards Board (FASB) to its Accounting Standards Codification (ASC) after April 5, 2012, the date of the enactment of the JOBS Act (Question 33, May 3 FAQs).

FPI EGCs Reconciling Their Home Country GAAP Financial Statements to US GAAP are Eligible for the Extended Transition Period. If it qualifies as an EGC, an FPI that reconciles its home country GAAP financial statements to US GAAP may take advantage of the extended transition period in its US GAAP reconciliations (Question 34, May 3 FAQs).

An EGC that Chooses to Take Advantage of the Extended Transition Period Can Later "Opt In" to Non-EGC Treatment. An EGC that initially decides to take advantage of the extended transition period may later choose to "opt in" and comply with the financial accounting standard effective dates applicable to all non-EGCs, as long as it:

The EGC should prominently disclose its decision to opt in in the first periodic report or registration statement it files following its decision. The decision to opt in is irrevocable (Question 37, May 3 FAQs).