Filing agents pose only small risks
It was nothing short of seismic to hear news that RR Donnelly--a well-known vendor that, among other things, files statements on behalf of companies in EDGAR, the SEC's automated system--had botched Google's third-quarter statement.
At least the numbers were accurate, though the release was incomplete. In any case, the stock tanked. The sell off appears to have been driven more by the actual results than the confusion stemming from the premature release. Still, other issuers are no doubt wondering what their risks are.
Could this happen to them?
The New York Times weighs in, noting that such instances are rare and are usually inconsequential. One agent at a filing company was quoted saying, "I can't remember one that's been apparently as bad as this one."
He said that "his company had several safeguards against early posting and that employees were trained to look for signs of an unfinished document and personal information, like Social Security numbers or home addresses, that is sometimes inadvertently included."
Companies will no doubt be seeking reassurance from RR Donnelly and other filing agents that this sort of thing can't happen to them. Or can it? The reality is that many filing agents are so bent on delivering a lot of value-added services, including XBRL filing expertise, that it would be easy to forget about basic blocking and tackling. The Google fiasco is a timely reminder they can't afford to go soft on the basics.
- here's the article
Google mistakenly releases earnings