SEC Scrutiny of Executive Perks Brings Pitfalls for Companies

Over the last decade, the Securities and Exchange Commission has brought 20 enforcement cases against public companies for not properly disclosing perks provided to executives—including two last year.

The SEC’s expansive view of what constitutes a perk—and the low-dollar thresholds for disclosure—can make it challenging for companies to identify, quantify, and fully describe them. But failing to disclose perks can be expensive, as companies may face significant costs to investigate, defend, and remediate problematic disclosures and internal controls. And the SEC often imposes sizable financial sanctions when faulty disclosures come to light.

To help reduce the risk of undisclosed executive perks, we’ve identified those that most often lead to SEC enforcement actions, as well as practical steps companies can take to strengthen relevant internal financial and disclosure controls.

Source: SEC Scrutiny of Executive Perks Brings Pitfalls for Companies