As a reminder, public companies with fiscal years ended September 30, 2024 must now disclose whether the company has adopted insider trading policies and procedures that apply to transactions involving the company’s securities by its directors, officers and employees or the company itself in their upcoming annual reports on Form 10-K. Companies must also file such policies and procedures as Exhibit 19 to their annual reports.
Form 10-K now requires companies to include the disclosure required by Item 408(b)(1) of Regulation S-K under Item 10, Directors, Executive Officers and Corporate Governance. Item 408(b)(1) requires disclosure if the company has:
- adopted insider trading plans and procedures that are “reasonably designed to promote compliance with insider trading laws, rules and regulations, and any listing standards”;
- governing the purchase, sale, and/or other dispositions of the company’s securities;
- by the company’s directors, officers and employees, or the company itself.
If the company has not adopted such policies and procedures, Item 408(b)(1) requires the company to explain why it has not done so. The disclosure required by Item 408(b)(1) is subject to the interactive XBRL requirements.
If the company has adopted insider trading policies and procedures that are subject to the requirements of Item 408(b)(1), Item 408(b)(2) and Item 601(b)(19) of Regulation S-K require the company to file its insider trading policies and procedures as Exhibit 19 to the Form 10-K.
This exhibit filing requirement is satisfied if all of the company’s insider trading policies and procedures are included in its code of ethics, as defined in Item 406(b) of Regulation S-K, and the company has filed its code of ethics as Exhibit 14 to its Form 10-K pursuant to Item 406(c)(1) and Item 601(b)(14). In these cases, the exhibit index should list Exhibit 19, Insider Trading Policies and Procedures, and include a statement similar to the following: “Included in Exhibit 14.”
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