Can You Rely on Your Filer’s Proofreading Skills?

The 10Q deadline is fast approaching, and many of you might still be working on the final changes to your document. Just remember, in the chaos of preparing your final documents, it is very possible to make mistakes. Now would be a good time to ask your filer about their proofreading strategies. Below are some questions to ask your filer before filing your 10Q. What qualifications do their proofreaders have? A proofreader’s skills can vary by industry experience, education or natural talent. If you are lucky, your filer has hired reviewers that possess all three. An educated reviewer will know how to use and read the proper proofreading marks that are necessary when dealing with handwritten edits to a document. Also, if they are experienced in the industry, they’ll quickly spot inconsistencies that might not fly with the SEC. Finally, nothing beats natural talent and attention to detail. If the proofreader is able to quickly spot inaccuracies otherwise not seen by the filing agent or client, wasted hours and money in amendments will be avoided. How long does it take to review a document? Obviously, every document is different. The time it takes to review a document depends on many factors. For instance, a document that is 200 pages might take longer to review than a 20 page document. But, the same attention to detail is pertinent in both cases. Also, a document that has been revised significantly from the original version might take longer to review as well. In any case, reviewing a document shouldn’t take more than an hour in general. Is there an extra charge to review larger documents? In a nutshell, the answer to this question should be no. Some filers might need to charge extra in order to pay for two or more reviewers to work on one large document. Although understandable, this should not be common practice. Better put, it is not good customer service. Find out if your filer hires extra help during busy seasons. This cost might be getting handed down to you. Are their proofreaders industry people? As I mentioned before, a good proofreader will consist of the three skills described earlier. So, of course it is best to have an industry person review your document. An industry person will know what to look for and what to overlook. During crunch time, this skill is especially important. You’ll need to have some one quickly, yet thoroughly, review for inaccuracies that are most significant to the SEC. In contrast, smaller details like missing commas that should have been addressed in earlier versions, will need to be overlooked when there is only five minutes left to file a document. What do proofreaders look for? Proofreaders should follow a manual created by the company that lists a number of items to look for. For example, one of the items a reviewer would check is the consistency in the dates and signatures. The dates and signatures in the document should be consistent with the date the document is filed and the signature of the person who is required to sign the document. Another detail a reviewer might notice is inaccuracies in the table of contents once the document has been formatted into EDGAR. The document might have been altered to fit into the EDGAR system, which in turn changes the page numbers. The page numbers in the table of contents will then need to be updated. There are many elements proofreaders are trained to look for, but the key is to have an in-house checklist of items that all reviewers should be required to review and address when proofreading a document. Are their proofreaders familiar with XBRL GAAP Taxonomies? Yes. Reviewers should be aware of at least the most recent and commonly used XBRL GAAP taxonomies, although knowing ALL taxonomies is not humanly possible. If anything, proofreaders should at least know where to look to verify proper taxonomies if they are not sure. Recent news has shown that too many XBRL filers use the wrong taxonomies when tagging documents. This has resulted in inaccurate reporting and difficulty comparing company financials. Industry has since requested a closer look into this problem, and XBRL US, a non-profit consortium for XBRL reporting standards, has taken the responsibility to find a solution. So as you address the final touches to your 10Q document, take a few minutes to learn more about your filer’s proofreading strategies. The effort could save you hundreds of dollars in amendments and overall aggravation. To learn more about Edgar Agents and its services, please visit our site at www.edgaragents.com. You can also call us at 732-780-5036.