The Securities and Exchange Commission recently amended the Securities Regulation Code Rule 68 (SRC Rule 68, As Amended) with revised, new and additional requirements.
Download a copy of the Securities Regulation Code Rule 68 (SRC Rule 68, As Amended).
See also SEC Financial Reporting Bulletins 1 to 5 and SEC Financial Reporting Bulletin 6 to 12 (SRC Rule 68) (supplement to SRC Rule 68).
Application of the Rule:
I. Part I of the SEC Rule 68, As Amended is applicable to the following corporations:
- Stock corporations with paid-up capital stock of P50,000.00 or more;
- Non-stock corporations with total assets of P500,000.00 or more, or with gross annual receipts of P100,000.00 or more;
- Branch offices of stock foreign corporations with assigned capital in the equivalent amount of P1,000,000.00 or more;
- Branch offices of non-stock corporations with total assets in the equivalent amount of P1,000,000.00 or more;
- Regional operating headquarters of foreign corporations with total revenues in the equivalent amount of P1,000,000.00 or more.
Financial statements of branch offices of foreign corporations licensed to do business in the Philippines by the Commission shall comply with the requirements of the SEC Rule 68, As Amended unless otherwise determined by the Commission as not applicable.
Additional requirements for financial statements of corporations covered under Section 17.2 of the Securities Regulation Code are set forth under Part II of the SEC Rule 68, As Amended.
II. In addition to those set forth under Part I of the SRC Rule 68, As Amended, Part II shall be applicable to the following:
- Issuer which has sold a class of their securities pursuant to a registration under Section 12 of the Code;
- Issuer with a class of securities listed for trading on an Exchange; and
- Issuer with assets of at least P50,000,000.00 or such other amount as the Commission shall prescribe and has two hundred (200) or more holders each holding at least one hundred (100) shares of a class of its equity securities as of the first day of the issuer’s fiscal year.
Significant Changes in SEC Rule 68:
- Revised Statements of Management Responsibility
- Modification in the auditors’ report for companies with capital deficiency
- Impact of modified auditors’ opinion on the financial statements (f0r entities covered by Part II only)
- Additional and revised disclosures under Annex 68-D for companies covered by Rule 68 Part II
- Revised supplementary schedules under Annex 68-E for companies covered by Rule 68 Part II
- Additional documents to be filed with the financial statements of certain types of entities
The SRC Rule 68, As Amended, shall become effective for audited financial statements covering periods ending December 31, 2011 and onwards, and for interim financial statements starting the first quarter of 2012, and thereafter.