Classic file types are no longer available for use as of January 2021. You can transition your classic files or download a PDF. Learn More

Impacts of Pay vs Performance final ruling

Pinned Featured
5

Comments

9 comments

  • Kenneth Ho

    Thank you for sharing.  I glanced the final rule and there is no mentioning of specific taxonomy for the tagging.  I am sure additional information will come in the next few months.  

    0
  • Carolina Koch

    I hope you can clarify for me.  Regarding the XBRL US comment (below).  My understanding is that this new table goes in the proxy, and the proxy currently does not have XBRL tagging, so I'm not clear on what the requirement is or how to execute it.  Thanks!  

    The final rule requires registrants to separately tag each value disclosed in the table, block-text tag the footnote and relationship disclosure, and tag specific data points (such as quantitative amounts) within the footnote disclosures, all in Inline XBRL.

    0
  • Mike

    Hi Carolina!

    Thanks for the question. Happy to provide some insights for ya. 

    Yes, you are correct. XBRL tagging for Proxy's would be entirely newly. As we read it, XBRL will be required for the first time in Proxy filings, starting with the first proxy filed after December 2022 for Large Accelerated and Accelerated filers, and after the third Proxy filing for Smaller Reporting Companies (emerging growth and foreign filers are not required to tag the proxy).
     
    To your point, and Ken's above, currently there is no taxonomy that includes the required tags, but we do expect supplement US-GAAP 2022 taxonomy to be released towards the end of the year to meet this need. We'll certainly keep you posted there.
     
    Let me know if you have any follow-ups or need anything else. Cheers!
    0
  • Dale Karasek

    That is how I read it - the table is in the proxy and will need to be tagged but not the rest of the proxy. 

    For SRCs, wouldn't they have to tag beginning with the third filing, not the first, which would be 2025 for calendar year registrants? It says April 2026 above.

    Here is the final rule:

    The final rules require registrants to separately tag the values disclosed in the table in Inline XBRL, block-text tag the footnote and relationship disclosure
    and the Tabular List in Inline XBRL, and tag specific data points (such as quantitative amounts) within the footnote disclosures in Inline XBRL.

    Mike Can you provide where in the rule it states the following, which is noted above "The required tagging will include both the current executive compensation table as well as a new Pay Versus Performance table"? I thought only the new table had to be tagged as well as the tabular list. Please confirm. 

    0
  • Mike

    Hi Dale!

    Happy to share a little. Our understanding is that only the new Item 402(v) to Regulation S-K / Pay Verse Performance table will need to be tagged as the final rule and the summary only mentions the PvP table tagging.
    0
  • Dale Karasek

    Thanks, Mike. Do you want to change that in the post above as well as the date? 

     

    0
  • Mike

    Good catch, Dale. I have amended the items about needing the PvP table tagged and date. We concur that the final rule only means the Pay Verse Performance table (Item 402(v)), and for or the SRC requirement, these kick in beginning with the third proxy filing after December 2022. Since first proxy filings after that date will be spring 2023, meaning the third would be in spring 2025's filing. But note this isn't an actual implementation date but instead based solely off of the filing count, so dates for companies will vary

    0
  • Michelle Cole

    What about the cover page of the proxy?  Will it need to be tagged similar to 8-Ks and 10-Q/Ks?  We don't see any mention of tagging on the cover.  

    0
  • Dale Karasek

    The cover page for the proxy changed earlier this year to move the filing fee information to an exhibit but I also do not see where this information (cover page or the exhibit) require Inline XBRL. I think it will be important for registrants to build the new proxy tagging into their timeline, especially those using notice and access,  which has a strict filing requirement. 

    0

Please sign in to leave a comment.