IN THE SENATE OF THE UNITED STATES
February 12, 2019
Mr. Tillis (for himself, Mr. Peters, Mr. Perdue, and Ms. Sinema) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs
To amend the Sarbanes-Oxley Act of 2002 to provide a temporary exemption for low-revenue issuers from certain auditor attestation requirements.
This Act may be cited as the
Fostering Innovation Act of 2019.
Temporary exemption for low-revenue issuers
Section 404 of the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7262) is amended by adding at the end the following:
Temporary exemption for low-Revenue issuers
In this subsection—
the term average annual gross revenues means the total gross revenues of an issuer over its most recently completed 3 fiscal years divided by 3;
the term emerging growth company has the meaning given the term in section 3 of the Securities Exchange Act of 1934 (15 U.S.C. 78c); and
the term large accelerated filer has the meaning given the term in section 240.12b–2 of title 17, Code of Federal Regulations (or any successor regulation).
Subsection (b) shall not apply with respect to an audit report prepared for an issuer that—
ceased to be an emerging growth company on the last day of the fiscal year of the issuer following the 5-year period beginning on the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under the Securities Act of 1933 (15 U.S.C. 77a et seq.);
had average annual gross revenues of less than $50,000,000 as of its most recently completed fiscal year; and
is not a large accelerated filer.
Expiration of temporary exemption
An issuer ceases to be eligible for the exemption described under paragraph (1) on the earlier of—
the last day of the fiscal year of the issuer following the 10-year period beginning on the date of the first sale of common equity securities of the issuer pursuant to an effective registration statement under the Securities Act of 1933 (15 U.S.C. 77a et seq.);
the last day of the fiscal year of the issuer during which the average annual gross revenues of the issuer exceed $50,000,000; or
the date on which the issuer becomes a large accelerated filer.