Regulators Warn That SPAC Accounting Errors Require Fixes

By Tom Zanki (April 12, 2021, 10:00 PM EDT) -- The U.S. Securities and Exchange Commission on Monday cautioned that special purpose acquisition companies may need to refile regulatory documents to correct accounting errors involving the classification of warrants, potentially generating uncertainty for the red-hot SPAC market.

SEC officials said the agency conducted a recent study of "fact patterns" involving warrants issued in connection with SPACs, also known as blank-check companies, revealing that such instruments may be considered liabilities rather than equity under certain circumstances. SPAC warrants until now have generally been understood as forms of equity.

The securities watchdog, which has been reviewing hundreds of blank-check initial public offerings in...

Stay ahead of the curve

In the legal profession, information is the key to success. You have to know what’s happening with clients, competitors, practice areas, and industries. Law360 provides the intelligence you need to remain an expert and beat the competition.

  • Access to case data within articles (numbers, filings, courts, nature of suit, and more.)
  • Access to attached documents such as briefs, petitions, complaints, decisions, motions, etc.
  • Create custom alerts for specific article and case topics and so much more!


Hello! I'm Law360's automated support bot.

How can I help you today?

For example, you can type:
  • I forgot my password
  • I took a free trial but didn't get a verification email
  • How do I sign up for a newsletter?
Ask a question!