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SEC: Companies Must Disclose Details about Supply Chain Financing

Dec. 10, 2019, 9:16 PM

Companies need to reveal more details about complex financing arrangements that can temporarily boost cash flows but mask looming debts, the Securities and Exchange Commission said.

The market regulator sees a rise in companies using supply chain financing to increase their liquidity but no corresponding increase in communication with investors about how the transactions work, SEC Corporation Finance Deputy Chief Accountant Lindsay McCord said Dec. 10.

That needs to change, McCord said at an American Institute of CPAs conference in Washington.

Companies need to disclose in the Management’s Discussion and Analysis section of their financial statements the existence of ...

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