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Thursday,

August 9, 2007

Part II

Securities and
Exchange
Commission
17 CFR Parts 210 and 240
Definition of the Term Significant
Deficiency; Final Rule
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44924 Federal Register / Vol. 72, No. 153 / Thursday, August 9, 2007 / Rules and Regulations

SECURITIES AND EXCHANGE requirement in Exchange Act Rules 13a– material weakness, yet important enough to
COMMISSION 15(c) and 15d–15(c).7 The Interpretive merit attention by those responsible for
Release also added a definition of the oversight of a registrant’s financial reporting.
17 CFR Parts 210 and 240 term ‘‘material weakness’’ to the We received 22 comment letters in
[Release Nos. 33–8829; 34–56203; File No. Commission’s rules. The term is defined response to the request for additional
S7–24–06] as ‘‘a deficiency, or combination of comment.15 These letters came from
deficiencies, in internal control over accounting firms, professional
RIN 3235–AJ58 financial reporting, such that there is a associations, corporations and other
reasonable possibility that a material interested parties. We have reviewed
Definition of the Term Significant misstatement of the registrant’s annual and considered all of the comments that
Deficiency or interim financial statements will not we received on the proposed definition.
AGENCY: Securities and Exchange be prevented or detected on a timely We discuss our conclusions with
Commission. basis.’’ 8 respect to the comments in more detail
ACTION: Final rule. As part of the Commission’s efforts to in this release.
provide more guidance to management
on ICFR, the Commission initially II. Discussion
SUMMARY: We are defining the term
‘‘significant deficiency’’ for purposes of sought comment on both the terms A company’s principal executive
the Commission’s rules implementing ‘‘significant deficiency’’ and ‘‘material officer and principal financial officer
Section 302 and Section 404 of the weakness’’ in a concept release on ICFR must certify that they have disclosed
Sarbanes-Oxley Act of 2002. requirements,9 and then proposed and significant deficiencies in the design or
DATES: Effective Date: September 10, adopted a definition of the term operation of ICFR that are reasonably
2007. ‘‘material weakness.’’ 10 Several likely to adversely affect the company’s
commenters pointed out that while the ability to record, process, summarize
FOR FURTHER INFORMATION CONTACT: N. proposing release for the interpretive and report financial information, to the
Sean Harrison, Special Counsel, guidance 11 referenced the term external auditor and the audit
Division of Corporation Finance, at ‘‘significant deficiency,’’ the committee, with the intended result that
(202) 551–3430, or Josh K. Jones, Commission did not include a these parties can more effectively carry
Professional Accounting Fellow, Office definition of the term in the proposal.12 out their respective responsibilities with
of the Chief Accountant, at (202) 551– Certain commenters indicated that the regard to the company’s financial
5300, U.S. Securities and Exchange Commission should include a definition reporting.16 Including a definition of
Commission, 100 F Street, NE., of significant deficiency in the ‘‘significant deficiency’’ in Commission
Washington, DC 20549. Interpretive Release.13 rules, in addition to the definition of
SUPPLEMENTARY INFORMATION: We are In light of the comments received in ‘‘material weakness,’’ will enable
adopting amendments to Rule 12b–2 1 response to the proposed interpretive management to refer to Commission
under the Securities Exchange Act of guidance, and because Commission rules and guidance for information on
1934 (the ‘‘Exchange Act’’) 2 and Rule 1– rules implementing Section 302(a) of the meaning of these terms rather than
02 3 of Regulation S–X.4 the Sarbanes-Oxley Act require senior referring to the auditing standards.
management to certify they have In developing the definition of
I. Background ‘‘significant deficiency,’’ we considered
communicated significant deficiencies
On June 27, 2007, the Commission to the audit committee and the external comments received in response to the
issued interpretive guidance and rule auditors, the Commission solicited Public Company Accounting Oversight
amendments to help public companies additional comment on a definition for Board’s proposed auditing standard for
strengthen their evaluations and ‘‘significant deficiency.’’ In a release audits of internal control over financial
assessments of internal control over issued on June 27, 2007, the reporting. In its proposed auditing
financial reporting (‘‘ICFR’’) while Commission requested additional standard, the PCAOB proposed to define
reducing unnecessary costs.5 The comment on the following definition of significant deficiency as ‘‘a control
Interpretive Release provides guidance the term ‘‘significant deficiency:’’ 14 deficiency, or combination of control
for management on how to conduct an deficiencies such that there is a
A deficiency, or a combination of
evaluation of the effectiveness of a deficiencies, in internal control over reasonable possibility that a significant
company’s ICFR under the financial reporting that is less severe than a misstatement of the company’s annual
Commission’s rules implementing or interim financial statements will not
Section 404 of the Sarbanes-Oxley Act 7 17 CFR 240.13a–15(c) and 15d–15(c). be prevented or detected.’’ 17 Further,
of 2002.6 The guidance sets forth an 8 See Rule 1–02(p) of Regulation S–X [17 CFR
210.1–02(p)] and Exchange Act Rule 12b–2 [17 CFR 15 The comment letters are available for
approach by which management can
240.12b–2]. In this release, we are moving the inspection in the Commission’s Public Reference
conduct a top-down, risk-based definitions to new paragraph (a)(4) of Rule 1–02. Room at 100 F Street, NE., Washington, DC 20549
evaluation of ICFR. The rule 9 Release No. 34–54122 (Jul. 11, 2006) [71 FR in File No. S7–24–06, or may be viewed at
amendments, among other things, 40866, Jul. 18, 2006] available at http:// http://www.sec.gov/comments/s7-24-06/
provide that an evaluation that complies www.sec.gov/rules/concept/2006/34–54122.pdf. s72406.shtml.
16 See Section 302(a)(4) of the Sarbanes-Oxley Act
10 See Release No. 33–8809 (Jun. 20, 2007) [72 FR
with the interpretive guidance is one (requiring signing officers to certify that they are
35310, Jun. 27, 2007].
way to satisfy the annual evaluation 11 Release No. 33–8762 (Dec. 20, 2006) [71 FR responsible for establishing and maintaining
internal controls and have designed the internal
77635, Dec. 27, 2006].
1 17 CFR 240.12b–2. 12 See, for example, letters from Cardinal Health,
controls to ensure that material information relating
2 15 U.S.C. 78a et seq. to the issuer is made known to the signing officers,
Inc. (‘‘Cardinal’’), Edison Electric Institute, and and have disclosed any significant deficiencies in
3 17 CFR 210.1–02.
Protiviti to Release No. 33–8762, File No. S7–24–
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internal control to the independent auditors and


4 17 CFR 210.1–01 et seq. 06. audit committee) [15 U.S.C 7241].
5 See Release No. 33–8809 (Jun. 20, 2007) [72 FR 13 See, for example, letters from Cardinal and 17 See PCAOB Proposed Auditing Standard, An
35310, Jun. 27, 2007] and Release No. 33–8810 (Jun. Protiviti to Release No. 33–8762, File No. S7–24– Audit of Internal Control Over Financial Reporting
20, 2007) [72 FR 35324, Jun. 27, 2007] (hereinafter 06. that is Integrated with an Audit of Financial
‘‘Interpretive Release’’). 14 Release No. 33–8811 (Jun. 20, 2007) [72 FR Statements and Related Other Proposals (PCAOB
6 15 U.S.C. 7262. 35346, Jun. 27, 2007]. Release No. 2006–007, Dec. 19, 2006).

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Federal Register / Vol. 72, No. 153 / Thursday, August 9, 2007 / Rules and Regulations 44925

the PCAOB proposed to define a noted that a consistent definition of Commission received related to
significant misstatement as ‘‘a significant deficiency in the Auditing Standard No. 5.22 Therefore,
misstatement that is less than material Commission’s rules and in the PCAOB’s we decided not to add a likelihood
yet important enough to merit attention standards was imperative to promoting component to the definition as adopted.
by those responsible for oversight of the effective and efficient compliance by Many commenters believed the
company’s financial reporting.’’ In management and auditors with respect definition allowed for the appropriate
response to the comments received on to their responsibilities to communicate exercise of management and auditor
its proposal, the PCAOB, working with and respond to significant deficiencies judgment regarding what is important
the Commission staff, decided to modify in internal control. Some of these enough to merit attention based on each
its proposed definition to focus the commenters also supported the company’s particular facts and
auditor on the communication Commission’s inclusion of the term circumstances, and that some variability
requirement surrounding the term within its rules so that management in the nature of items reported to the
‘‘significant deficiency’’ and to clarify could look to the Commission’s rules for audit committee and auditors may
that auditors should not scope their the definition.19 result.23 However, these commenters
audit procedures to search for A number of commenters agreed that believed that this would be acceptable
deficiencies that are less severe than a the proposed definition of ‘‘significant based on the specific facts and
material weakness. deficiency’’ should not include a circumstances of the individual
In proposing the definition, we likelihood component.20 However, a registrants, and the fact that significant
believed that the focus of the term few commenters stated the definition deficiencies are not required to be
‘‘significant deficiency’’ should be on should include a likelihood component disclosed publicly.
the communications required to take because they believed that the addition Some commenters also requested that
place among management, audit of such a component would enhance further clarification be provided by the
committees and independent auditors. management’s ability to evaluate Commission related to the proposed
Therefore, we believed that the deficiencies that need to be definition. One commenter suggested
framework for the definition of communicated to the audit committee.21 that it should be clarified to allow for
‘‘significant deficiency’’ should vary We agree with the commenters who management, at its discretion, to
from that recently adopted for ‘‘material stated that it was not necessary for the communicate deficiencies to the audit
weakness.’’ Unlike the definition of the definition to include a likelihood committee and the auditor that it does
term ‘‘material weakness,’’ we did not component, as it could have the not believe are significant deficiencies
believe it was necessary for the unintended effect of diminishing the in order to provide management with
proposed definition of ‘‘significant use of appropriate judgment by the appropriate flexibility to
deficiency’’ to include a likelihood management and independent auditors communicate other matters as it deems
component (that is, reasonable in performing the evaluation. We appropriate.24 Other commenters
possibility). Rather, we believed that a believe that excluding a likelihood requested additional guidance on
definition focused on matters that are component from the definition reduces determining whether a deficiency is a
important enough to merit attention the chance that management or significant deficiency.25 Some of these
would allow for, and indeed encourage, independent auditors will design and commenters suggested that additional
sufficient and appropriate judgment by implement evaluations or audits for the guidance such as providing qualitative
management to determine the purpose of identifying deficiencies that and quantitative thresholds to consider
deficiencies that need to be reported to are less severe than material in the evaluation, would provide
the independent auditor and the audit weaknesses. Further, we believe the management and auditors a basis to
committee. guidance provided in our Interpretive agree on whether a deficiency is a
Release and in the PCAOB’s Auditing significant deficiency and would
Comments on the Proposal Standard No. 5, An Audit of Internal minimize unnecessary costs.26 One of
A majority of commenters expressed Control Over Financial Reporting that is these commenters noted that further
their support for the proposed Integrated with an Audit of the guidance with regards to materiality
definition,18 noting that it would further Financial Statements (‘‘Auditing generally was important to provide
the Commission’s objective of Standard No. 5’’), appropriately outlines management and auditors with more
improving implementation of the that the scope of each evaluation is to clarity when evaluating deficiencies,
provisions of the Sarbanes-Oxley Act of detect material weaknesses, which is which would enable a more effective
2002. These commenters also noted that also consistent with comments the and efficient process.
the definition would permit the exercise With respect to the communication
of appropriate judgment by management 19 See, for example, letters from BDO Seidman requirements associated with significant
and independent auditors to determine LLP; Center for Audit Quality; Committees on
Federal Regulation of Securities and Law and 22 See comments received for Releases 34–55912
those deficiencies in ICFR that are Accounting of the Section of Business Law of the and 34–55876.
important enough to merit attention by American Bar Association; Deloitte & Touche LLP; 23 See, for example, letters from BDO Seidman,
those responsible for oversight of Ernst & Young LLP; Grant Thornton LLP; KPMG
LLP; Deloitte & Touche LLP; Ernst & Young LLP;
LLP; and PricewaterhouseCoopers LLP.
financial reporting. In addition, they 20 See, for example, letters from BDO Seidman,
Financial Executives International—Small Public
Company Task Force; Grant Thornton LLP;
LLP; Committees on Federal Regulation of
18 See, for example, letters from BDO Seidman, PepsiCo; and PricewaterhouseCoopers LLP.
Securities and Law and Accounting of the Section 24 See letter from The Society of Corporate
LLP; Center for Audit Quality; Committees on of Business Law of the American Bar Association;
Federal Regulation of Securities and Law and Deloitte & Touche LLP; Ernst & Young LLP; Grant Secretaries and Governance Professionals.
25 See, for example, letters from Keith Bishop;
Accounting of the Section of Business Law of the Thornton LLP; PepsiCo; Society of Corporate
American Bar Association; Deloitte & Touche LLP; Secretaries and Governance Professionals; U.S New York State Society of Certified Public
Accountants; Sprint Nextel Corporation; and U.S.
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Ernst & Young LLP; Financial Executives Chamber Center for Capital Market
International—Small Public Company Task Force; Competitiveness; and The Institute of Internal Chamber Center for Capital Market
Grant Thornton LLP; KPMG LLP; PepsiCo; Auditors. Competitiveness.
PricewaterhouseCoopers LLP; The Internal Auditors 21 See, for example, letters from Financial 26 See, for example, letters from New York State

Division of the Securities Industry and Financial Executives International—Small Public Company Society of Certified Public Accountants; U.S.
Markets Association; Sprint Nextel Corporation; Task Force; PricewaterhouseCoopers LLP; and Chamber Center for Capital Market
and The Institute of Internal Auditors. Simone Heidema and Erick Noorloos. Competitiveness.

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44926 Federal Register / Vol. 72, No. 153 / Thursday, August 9, 2007 / Rules and Regulations

deficiencies, we note that the definition these collections of information to the and independent auditors to determine
of significant deficiency is used in the Office of Management and Budget those deficiencies in ICFR that are
context of evaluating the minimum (‘‘OMB’’) for review in accordance with important enough to merit attention by
required communications under the PRA and received approval for the those responsible for oversight of
Sections 302 and 404 of the Sarbanes- collections of information. We do not financial reporting. We believe that, on
Oxley Act of 2002. Neither this believe the adoption of the definition of balance, the amendments will allow
definition nor the Commission’s rules ‘‘significant deficiency’’ will impose any management to use sufficient and
preclude management from new recordkeeping or information appropriate judgment to determine
communicating additional deficiencies collection requirements, or other whether any identified deficiencies
to the audit committee or the collections of information requiring need to be reported to the auditor and
independent auditor. Finally, with OMB’s approval. the audit committee. The flexibility
regards to requests for additional allowed by the definition will enable
IV. Cost-Benefit Analysis
guidance noted above, including on management and auditors to more
materiality when evaluating the A detailed analysis of the benefits and efficiently and effectively perform their
significance of deficiencies and costs was included in our releases evaluations based on a company’s
quantitative and qualitative guidance, proposing and adopting amendments to individual facts and circumstances. In
we believe that the definition allows rules regarding management’s reports on addition, many commenters noted that
management and auditors to ICFR.28 The amendments that we are a consistent definition between the
appropriately utilize their judgment in adopting in this release define the term Commission’s rules and the PCAOB’s
determining those deficiencies that are ‘‘significant deficiency.’’ We requested standards was imperative to promote
important enough to merit the attention comment on whether the amendments effective and efficient compliance by
of those responsible for oversight based would impose any additional benefits or management and auditors with respect
on their individual facts and costs on public companies or small to their responsibility to communicate
circumstances. Further, we do not entities. No commenter identified any and respond to significant deficiencies
believe that the definition of significant additional costs or burdens that would in internal control over financial
deficiency is the appropriate forum to result from the proposed definition. reporting.33 A consistent definition
address broader questions about Three commenters suggested that the between the Commission’s rules and the
materiality, which are fundamental to definition would not result in any PCAOB’s audit standards will enable
the federal securities laws. additional costs,29 while a number of management and independent auditors
commenters suggested that the to more efficiently and effectively
Final Rule definition may reduce the amount of perform their responsibilities to
We are adopting the definition of time needed by management and communicate significant deficiencies in
‘‘significant deficiency’’ substantially as auditors to evaluate whether or not internal control over financial reporting.
proposed. We believe the definition deficiencies are significant.30 Several Finally, eight commenters expressed
appropriately emphasizes the commenters also noted that one of the their view that the definition would not
communication requirements between significant benefits of the proposed have any special impact on smaller
management, the audit committee and definition was the flexibility provided, public companies.34 We do not believe
independent auditors on those matters which allows management and auditors that these amendments will have much,
that are important enough to merit to utilize their judgment to focus on if any, added impact on the costs to
attention and will allow management to those matters that are important enough public companies or small entities.
use its judgment to determine the to merit attention by those responsible
deficiencies that need to be reported to for oversight of financial reporting.31 V. Effect on Efficiency, Competition and
the audit committee and the Two commenters expressed concern Capital Formation
independent auditor. In addition, we that companies would have difficulty in Section 3(f) of the Exchange Act 35
believe that it is important that applying the definition because they requires the Commission, whenever it
management and auditors use the same believed more guidance was necessary engages in rulemaking and is required to
definition of ‘‘significant deficiency.’’ to allow management and independent consider or determine if an action is
Therefore, our final rules define a auditors to define and calibrate their necessary or appropriate in the public
significant deficiency as: procedures in order to minimize any interest, also to consider whether the
A deficiency, or a combination of unnecessary costs.32 Most commenters, action will promote efficiency,
deficiencies, in internal control over however, noted that the definition competition and capital formation.
financial reporting that is less severe would permit the exercise of Section 23(a)(2) of the Exchange Act 36
than a material weakness, yet important appropriate judgment by management also requires the Commission, when
enough to merit attention by those adopting rules under the Exchange Act,
28 See Release No. 33–8762 (December 20, 2006)
responsible for oversight of the to consider the impact that any new rule
[71 FR 77635, Dec. 27, 2006] and Release No. 33–
registrant’s financial reporting.27 8809 (Jun. 20, 2007) [72 FR 35310, Jun. 27, 2007]. would have on competition. In addition,
29 See, for example, letters from BDO Seidman,
III. Paperwork Reduction Act
LLP; Committees on Federal Regulation of 33 See, for example, letters from BDO Seidman,

Certain provisions of our ICFR Securities and Law and Accounting of the Section LLP; Center for Audit Quality; Deloitte & Touche
requirements contain ‘‘collection of of Business Law of the American Bar Association; LLP; Ernst & Young LLP; Grant Thornton LLP;
and Deloitte & Touche LLP. PepsiCo; PricewaterhouseCoopers LLP; and Sprint
information’’ requirements within the 30 See, for example, letters from BDO Seidman, Nextel Corporation.
meaning of the Paperwork Reduction LLP; PepsiCo; Society of Corporate Secretaries and 34 See, for example, letters from BDO Seidman,
Act of 1995 (‘‘PRA’’). We submitted Governance Professionals; and The Institute of LLP; Committees on Federal Regulation of
Internal Auditors. Securities and Law and Accounting of the Section
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27 Rule 1–02(a)(4) of Regulation S–X [17 CFR 31 See, for example, letters from BDO Seidman, of Business Law of the American Bar Association;
210.1–02(a)(4)]. We are adding a new paragraph LLP; Grant Thornton LLP; PricewaterhouseCoopers Deloitte & Touche LLP; Ernst & Young LLP; Grant
(a)(4) to the rule to define both the terms ‘‘material LLP; and The Institute of Internal Auditors. Thornton LLP; PepsiCo; PricewaterhouseCoopers
weakness’’ and ‘‘significant deficiency.’’ ‘‘Material 32 See letter from U.S. Chamber Center for Capital LLP; and The Institute of Internal Auditors.
35 15 U.S.C. 78c(f).
weakness’’ was previously added to paragraph (p) Market Competitiveness and New York State
of Rule 1–02. Society of Certified Public Accountants. 36 15 U.S.C. 78w(a)(2).

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Federal Register / Vol. 72, No. 153 / Thursday, August 9, 2007 / Rules and Regulations 44927

Section 23(a)(2) prohibits the commenter suggested that there would (a) * * *
Commission from adopting any rule that be a significant impact on any small (4) Definitions of terms related to
would impose a burden on competition entities. internal control over financial reporting.
not necessary or appropriate in Material weakness means a deficiency,
VII. Statutory Authority and Text of
furtherance of the purposes of the or a combination of deficiencies, in
Rule Amendments
Exchange Act. internal control over financial reporting
The Commission’s releases proposing The amendments described in this (as defined in § 240.13a–15(f) or
and adopting amendments to rules release are being adopted under the 240.15d–15(f) of this chapter) such that
regarding management’s reports on ICFR authority set forth in Sections 12, 13, 15, there is a reasonable possibility that a
contained a detailed discussion of the 23 of the Exchange Act, and Sections material misstatement of the registrant’s
effects of the rule amendments on 3(a) and 404 of the Sarbanes-Oxley Act. annual or interim financial statements
efficiency, competition and capital List of Subjects will not be prevented or detected on a
formation.37 We received some timely basis. Significant deficiency
comments on the effects of the rule on 17 CFR Part 210 means a deficiency, or a combination of
efficiency. Four commenters on the Accountants, Accounting, Reporting deficiencies, in internal control over
proposal believed the proposed and recordkeeping requirements, financial reporting that is less severe
definition of ‘‘significant deficiency’’ Securities. than a material weakness, yet important
would facilitate more efficient enough to merit attention by those
certifications of quarterly and annual 17 CFR Part 240
responsible for oversight of the
reports by allowing management to use Reporting and recordkeeping registrant’s financial reporting.
its judgment in evaluating the severity requirements, Securities.
of an identified deficiency.38 The * * * * *
Text of Amendments
flexibility allowed by the definition will PART 240—GENERAL RULES AND
enable management and auditors to ■ For the reasons set out in the REGULATIONS, SECURITIES
more efficiently and effectively perform preamble, the Commission amends title EXCHANGE ACT OF 1934
their evaluations based on a company’s 17, chapter II, of the Code of Federal
individual facts and circumstances, Regulations as follows: ■ 3. The authority citation for Part 240
which will promote efficiency. In continues to read, in part, as follows:
addition, a consistent definition PART 210—FORM AND CONTENT OF
between the Commission’s rules and the AND REQUIREMENTS FOR FINANCIAL Authority: 15 U.S.C. 77c, 77d, 77g, 77j,
STATEMENTS, SECURITIES ACT OF 77s, 77z–2, 77z–3, 77eee, 77ggg, 77nnn,
PCAOB’s audit standards will enable 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j,
management and independent auditors 1933, SECURITIES EXCHANGE ACT
78j–1, 78k, 78k–1, 78l, 78m, 78n, 78o, 78p,
to more efficiently perform their OF 1934, PUBLIC UTILITY HOLDING 78q, 78s, 78u–5, 78w, 78x, 78ll, 78mm, 80a–
responsibilities to communicate COMPANY ACT OF 1935, INVESTMENT 20, 80a–23, 80a–29, 80a–37, 80b–3, 80b–4,
significant deficiencies in internal COMPANY ACT OF 1940, INVESTMENT 80b–11, and 7201 et seq., and 18 U.S.C. 1350,
control over financial reporting. We did ADVISERS ACT OF 1940, AND unless otherwise noted.
not receive any comments on capital ENERGY POLICY AND * * * * *
formation or competition. We do not CONSERVATION ACT OF 1975
■ 4. Amend § 240.12b–2 by adding the
believe that the rule amendment will ■ 1. The authority citation for Part 210 definition of ‘‘Significant deficiency’’ in
impact capital formation or competition. continues to read as follows: alphabetical order to read as follows:
VI. Regulatory Flexibility Act Authority: 15 U.S.C. 77f, 77g, 77h, 77j, 77s,
Certification § 240.12b–2 Definitions.
77z–2, 77z–3, 77aa(25), 77aa(26), 78c, 78j–1,
78l, 78m, 78n, 78o(d), 78q, 78u–5, 78w(a), * * * * *
The Commission hereby certifies
78ll, 78mm, 80a–8, 80a–20, 80a–29, 80a–30, Significant deficiency. The term
pursuant to 5 U.S.C. 605(b) that the 80a–31, 80a–37(a), 80b–3, 80b–11, 7202 and
definition of ‘‘significant deficiency’’ significant deficiency is a deficiency, or
7262, unless otherwise noted. a combination of deficiencies, in
will not have a significant economic
impact on a substantial number of small ■ 2. Amend § 210.1–02 by: internal control over financial reporting
entities. We requested comments on the ■ a. Adding paragraph (a)(4); that is less severe than a material
anticipated impact and seven ■ b. Removing paragraph (p); and weakness, yet important enough to
commenters stated that the definition ■ c. Redesignating paragraphs (q) merit attention by those responsible for
would not have any special impact on through (cc) as paragraphs (p) through oversight of the registrant’s financial
smaller public companies.39 No (bb). reporting.
The addition reads as follows: * * * * *
37 See Release No. 33–8762 (December 20, 2006)
§ 210.1–02 Definitions of terms used in By the Commission.
[71 FR 77635, Dec. 27, 2006] and Release No. 33– Regulation S–X (17 CFR part 210).
8809 (Jun. 20, 2007) [72 FR 35310, Jun. 27, 2007]. Dated: August 3, 2007.
38 See, for example, letters from BDO Seidman, * * * * * Nancy M. Morris,
LLP; Grant Thornton LLP; PepsiCo; and Secretary.
PricewaterhouseCoopers LLP. Grant Thornton LLP; PepsiCo;
39 See for example, letters from BDO Seidman, PricewaterhouseCoopers LLP; and The Institute of [FR Doc. E7–15556 Filed 8–8–07; 8:45 am]
LLP; Deloitte & Touche LLP; Ernst & Young LLP; Internal Auditors. BILLING CODE 8010–01–P
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