The Form 8-Ks That The SEC May Have Overlooked

As reported by Cydney Posner, Broc Romanek and undoubtedly many others, Corporation Finance staff issued a new Compliance and Disclosure Interpretation addressing whether a re-measurement of a deferred tax asset to incorporate the effects of newly enacted tax rates or other provisions of the Tax Cuts and Jobs Act triggers an obligation to file under Item 2.06 of Form 8-K.  According to the C&DI, the answer is no because the re-measurement is not an impairment under ASC Topic 740 (be sure to read the staff's complete answer).

Some registrants may find that they nonetheless have an obligation to file or furnish a Form 8-K as a result of the new tax law.  As pointed out by Gibson Dunn & Crutcher and noted by Broc, issuers need to be mindful of the possibility that their public announcements will trigger an obligation to furnish a Form 8-K pursuant to Item 2.02.

My own addition to the list of possible Form 8-K triggers is Item 2.04 (Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Agreement).  It seems to me that it is at least conceivable that some financial covenants may be triggered by a re-measurement of deferred tax assets.  Of course, this will depend on the nature of the covenant and the magnitude of the re-measurement.

The no-name tax law

Section 11000(a) of the Senate engrossed amendment of H.R. 1 on December 14, 2017 read as follows: "(a) Short title.—This title may be cited as the 'Tax Cuts and Jobs Act'".  The enrolled version of the bill omits this language although numerous provisions of the bill explicitly refer to the "Tax Cuts and Jobs Act".  See, e.g., Section 12002.