What is the 135 day rule?

What is the 135 day rule?

Mind the 135-day Rule and the Dates for Delivery of the Comfort Letter. Accountants may provide negative assurance as to subsequent changes in specified financial statement items as of a date less than 135 days from the end of the most recent period for which the accountants have performed an audit or a review.

What is SAS 72 comfort letter?

Comfort letters are an important part of the underwriters’ due diligence review and defence from potential liability under US securities law. Comfort letters are often referred to as SAS 72 letters, which relates to the Statement on Auditing Standards 72 (SAS 72) on which they are based.

Is a review required for a comfort letter?

For counsel reviewing a comfort letter, any draft received should be reviewed against SAS 72’s examples in order to help ensure that all relevant or required items are covered by the letter.

What is a comfort letter in an audit?

A comfort letter is a business document that is intended to assure the recipient that a financial or contractual obligation with another party can and will be met. The sender is often an independent auditor or accountant. A comfort letter is also known as a letter of intent or, in some cases, a solvency opinion.

What is a 10b 5 letter?

A 10b-5 letter states that, after reasonable investigation, nothing has come to counsel’s attention that leads them to believe that the offering materials provided to investors contain a materially misleading statement or omit to make a statement without which the offering materials would be materially misleading.

What is a SAS 100 review?

SAS 100 contains more detailed and extensive guidance than that found in SAS 71. SAS 100 is effective for reviews of interim financial information for fiscal years beginning after December 15, 2002. The provisions in SAS 100 could have been utilized in advance of the required effective date.

Why would a bank accept a comfort letter?

It is usually used where the parent company is unable or unwilling to give a guarantee but wishes to give some comfort to the lender in respect of the subsidiary’s ability to perform its obligations.

What is the difference between 144A and regs?

Rule 144A provides an exemption for offers and sales to large “qualified institutional buyers” in the United States, while Regulation S exempts the offer and sale of securities to investors outside of the United States, both subject to compliance with certain other applicable eligibility requirements.

What are SAS 100 procedures?

SAS 100 provides guidance which is primarily in response to the requirement. The requirement is also applicable to a non-SEC registrant that makes a filing with a regulatory agency in preparation for a public offering or listing if the entity’s latest annual financial statements have been or are being audited.

What is a Bcl bank comfort letter?

Bank Comfort Letter (BCL) A Bank Comfort Letter is a document issued by a bank on behalf of its client (buyer) to a supplier, to assure the supplier of the financial ability and legality of the buyer in maintaining consistent trade.