Pitfalls Of 'Trends And Uncertainties' Disclosure

Law360, New York (September 14, 2012, 12:31 PM EDT) -- Item 303 of Regulation S-K requires the disclosure, in a company’s management discussion and analysis, of “any known trends or uncertainties … that the registrant reasonably expects will have a material favorable or unfavorable impact on net sales or revenues or income from continuing operations.”

A company’s failure to correctly anticipate which known “trends or uncertainties” ultimately will have a material impact and make corresponding disclosures may give rise to litigation in which nondisclosure will be judged in hindsight and with the benefit of knowledge of...
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