PwC's accounting podcast

Debt, warrants, and equity: What’s trending in SEC comments


Listen Later

In each episode of our What’s trending in SEC comments series, our guests bring you the latest themes in comment letters from the SEC’s Division of Corporation Finance for the most common topical areas of the financial statements.

This week we focus on debt, warrants, and equity. Tom Barbieri, a Deputy Chief Accountant in PwC’s National Office, and John Horan, Managing Director in PwC’s National Office, joined Heather Horn to break down some of the questions raised in these comments, giving you a deeper understanding of the SEC staff’s expectations, as well as context and insights into the GAAP requirements.

Topics include:

  • 1:46 - What types of comments are companies getting? Tom and John discuss the main themes of comments. Common questions relate to SPAC warrants and earnouts, debt modifications, preferred stock, embedded derivatives, and EPS.
  • 4:51 - SPAC warrants and earnouts. Accounting for SPAC warrants and earnouts can be complicated. John and Heather discuss the types of questions the SEC is asking on this topic and some best practices for determining the appropriate accounting.
  • 17:34 - Debt modifications and extinguishments. Accounting for a troubled debt restructuring, debt modifications, or extinguishment can be complex. Tom and Heather discuss some tips for getting disclosures about these transactions right the first time.
  • 23:51 - Preferred stock. John and Heather talk about the SEC staff’s interest in particular topical areas when asking about preferred stock. 
  • 31:05 - Embedded derivatives. Tom and Heather discuss accounting for embedded conversion features and other redemption provisions, and the importance of providing the right level of context for these in your disclosures.
  • 33:51 - Earnings per share. EPS has continued to be an ongoing area of focus for the SEC staff. John explains some of the areas that might give rise to a comment.
  • 40:03 - Key takeaways and reminders. We close with some future areas to pay attention to and helpful advice for issuers to address these issues heading into year end. Heather tries to stump Tom and John with some niche accounting questions.

Want to learn more?
Listen to our previous comment letter podcasts: Revenue: What’s trending in SEC comments, Goodwill: What’s trending in SEC comments, and Inventory and cost of sales: What’s trending in SEC comments, Segment reporting: What’s trending in SEC comments
Financial statement presentation guide: Chapter 5: Stockholders’ Equity, Chapter 12: Debt, Chapter 19: Derivatives and Hedging

Transcripts available upon request for indi

Did you enjoy this episode? Text us your thoughts and be sure to include the episode name.

...more
View all episodesView all episodes
Download on the App Store

PwC's accounting podcastBy PwC

  • 4.5
  • 4.5
  • 4.5
  • 4.5
  • 4.5

4.5

175 ratings


More shows like PwC's accounting podcast

View all
Accounting Best Practices with Steve Bragg by Steve Bragg

Accounting Best Practices with Steve Bragg

258 Listeners

WSJ Your Money Briefing by The Wall Street Journal

WSJ Your Money Briefing

1,718 Listeners

The McKinsey Podcast by McKinsey & Company

The McKinsey Podcast

379 Listeners

Bloomberg Surveillance by Bloomberg

Bloomberg Surveillance

1,185 Listeners

Bloomberg Intelligence by Bloomberg

Bloomberg Intelligence

403 Listeners

Bloomberg Businessweek by Bloomberg

Bloomberg Businessweek

438 Listeners

Masters in Business by Bloomberg

Masters in Business

2,156 Listeners

Exchanges by Goldman Sachs

Exchanges

981 Listeners

Talking Tax by Bloomberg Tax

Talking Tax

112 Listeners

The Accounting Podcast by Blake Oliver & David Leary

The Accounting Podcast

337 Listeners

Wall Street Breakfast by Seeking Alpha

Wall Street Breakfast

1,020 Listeners

All Things Sustainable by S&P Global

All Things Sustainable

60 Listeners

Dry Powder: The Private Equity Podcast by Hugh MacArthur, Bain & Company

Dry Powder: The Private Equity Podcast

147 Listeners

Here's Why by Bloomberg

Here's Why

65 Listeners

Bloomberg Daybreak: US Edition by Bloomberg

Bloomberg Daybreak: US Edition

73 Listeners