Thanks to Broc and Mike, I was able to share with readers last week in this post that the SEC, the Department of Justice and the President's Corporate Fraud Task Force had jointly concluded that Section 906 of Sarbanes-Oxley does not apply to 8-Ks, 6-Ks and 11-Ks. Broc and Mike share some additional thoughts this week.
Also, the Wall Street Journal had this article on Monday (subscription required): "SEC, Justice Dept. Say Execs Needn't Certify All Reports." Quote of Note from the WSJ article: "The staff of the SEC and the Justice Department, in consultation with their representatives on the corporate fraud task force, have concluded that the criminal certification requirements of Sarbanes-Oxley don't apply to current reports on form 6-K or 8-K, or employee benefit plan reports on form 11-K ," SEC corporation finance division director Alan Beller said in a telephone interview with Dow Jones Newswires on Friday.
Earlier this week, Broc Romanek reported in Broc's Daily Blog that Paula Dubberly of the SEC confirmed at an ACCA conference (during the Annual SEC Update) that the SEC, the Department of Justice and the President's Corporate Fraud Task Force have jointly concluded that Section 906 of Sarbanes-Oxley does not apply to 8-Ks, 6-Ks and 11-Ks. (Paula Dubberly is associate director (legal) of the Division of Corporate Finance at the SEC and oversees the office of the chief counsel, the office of rule making, and the office of enforcement liaison.) As some of you may recall, there were quite a few posts here back in late May and early June over whether or not the 906 Certification was required for an 11-K filing. (You can read previous posts about the controversy here.) It is great to get some resolution to this issue, but it would be even greater to find it in writing.
Perkins & Coie provides more great information: "Practical Guidance on Section 302 and Section 906 Certifications From the SEC's Final Rules Release." The article provides a sample Form 11-K Section 906 certification which has been modified to reflect that the "fairly presents" language relates to only the "net assets available for benefits and changes in net assets available for benefits of the plan." Perkins & Coie reminds readers that, in other contexts, "the SEC has specifically stated that altering the text of a required certificate invalidates the certification." The article also remarks that many companies are going ahead and having the CEO and CFO make the certification, instead of the chair of the employee benefits committee or other committee which oversees the plan(s).
Read more about this here . . .
LeBoeuf, Lamb, Green & McRae, LLP has posted this article: "Applicability of Section 906 Certification to Form 11-K Filings." Debevoise and Plimpton has published this article by Lawrence K Cagney and Elizabeth Pagel Serebranskys as well: "Sarbanes-Oxley Certification of Form 11-K Filings Required." The article at Debevoise and Plimpton has a detailed discussion of who should sign the certification and the criminal liability involved.
See previous posts on the subject here.
Sidley Austin Brown & Wood LLP provides this great discussion on the 906 Certification issue regarding SEC 11-K filings as well as this discussion. See also this post at Bowne Securities Connect. (Previous posts on the subject are here.)
The online edition of the Wall Street Journal (subscription required) has this article by Judith Burns: "Call for More Certifications Leaves Companies Confused." The article reports on the history behind the confusion over the 906 certification, and reports Paula Dubberly, an associate director in the SEC's corporation finance division, as stating a "stronger case could be made to certify 11-Ks" than the 8-K which is also under debate as well. The article also reports Dial Corp.'s general counsel, Christopher Littlefield, as saying that they are proceeding as if the 906 certification is required for the 11-K due to comments made by SEC officials at a public meeting in May, even though some outside lawyers said it wasn't necessary. The 11-K 906 certification issue has been discussed in previous posts which you can access here.
Broc Romanek at TheCorporateCounsel.net Blog has a June 12th post on the SEC Form 11-K 906 Certification requirement discussed in previous posts here.
Ropes & Gray has published this article on the 11-K 906 Certification issue discussed here in previous posts.
There have been multiple posts here about the issue of whether 906 Certifications are required for SEC Form 11-Ks for employee benefits plans. The SEC recently came out with a statement discussed here that it is deliberating on the whole issue. Assuming the certification is required, it has been suggested that the proper party to sign the 906 Certification probably is the chair of the plan committee which is normally appointed to oversee the plans, since the plan is really the "issuer" in this context. This should really cause a stir in the plan fiduciary community! They are still reeling from all of the fallout from Enron and the ERISA fiduciary litigation which is running through the courts. So, now they are not only subject to personal liability for fiduciary violations under ERISA, but they are subjected to possible criminal liability under Sarbanes-Oxley as well? Since I am not a securities lawyer, am I right on this? After the DOL's Amicus Brief in the Enron case, many practitioners are advising that high level individuals in the company (with insider information) not be allowed to serve on plan committees where employer stock is involved, due to the conflicts which may arise, so who would be left to sign these certifications? If readers are so inclined, comments would be welcome . . .
The SEC has issued SEC Release 33-8238, its final rules regarding "Management's Reports on Internal Control Over Financial Reporting and Certification of Disclosure in Exchange Act Periodic Reports." The SEC states the following regarding the Form 11-k 906 Certification requirement which has been discussed in previous posts:
"In light of these developments, we are considering, in consultation with the Department of Justice, the application of Section 906 to current reports on Forms 6-K and 8-K and annual reports on Form 11-K and the possibility of taking additional action."
In other words, the SEC is deferring on the issue until a later date.
The Release is discussed here at CorpLawBlog.
Perkins & Coie has this article discussing the SEC's stance on the 906 Certification requirement for SEC Form 11-K. The article points out that the SEC and the Department of Justice are leaning towards a conclusion that Form 11-K is covered by the 906 Certification requirement. The article also discusses who should make the certification. Finally, there is this discussion thread at Benefitslink on the issue. The issue has been discussed in prior posts which can now be viewed under this topic--Securities Requirements: Form 11-k 906 Cert.
CorpLawBlog has just posted an excellent discussion on the question raised here (and other places) yesterday regarding whether or not a 906 Certification is required for SEC 11-K filings with respect to employee benefit plans. The issue pertains to new requirements under the Sarbanes-Oxley Act of 2002.
Section 906 of the Sarbanes-Oxley Act of 2002 requires that all periodic reports containing financial statements that are filed with the SEC be accompanied by a written statement of the CEO and the CFO of the issuer (or officers performing equivalent functions), certifying the accuracy of certain information contained in such reports (referred to as a "906 Certification"). Apparently there has been a great deal of concern as whether or not the 906 Certification is required for Form 11-K filings for employee benefit plans. For calendar year ERISA plans, the Form 11-K is to be filed with the SEC within 180 days after the close of the plan's fiscal year, or June 30th. Please see this article by Cleary, Gottlieb, Steen & Hamilton on the subject, this message thread on Benefitslink which contains a link to the 11-K filing for Amazon.com (containing a 906 Certification), this commentary at realcorporatelawyer.com, and the recent SEC News Release 2003-66 by the SEC. Any corporate securities bloggers out there who can shed any light on the subject?
UPDATE: Read more about the subject here . . .