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Zimmerman's Research Guide


Comfort Letters

A company that wants to issue securities generally needs to get a "comfort letter" saying that the company's books are OK.

The rules governing comfort letters are found in the AICPA's Statement on Auditing Standards (SAS) number 72, "Letters for Underwriters and Certain Other Requesting Parties." In October 2011, SAS 72 was modified in by SAS 122, "Statements on Auditing Standards: Clarification and Recodification." Starting in 2013, comfort letters for non-public companies will be covered by AU-C 920, rather than SAS 72/122.

Comfort letters are considered private and not published anywhere.

SEC Letters: The SEC also writes "comfort letters," also known as "closing" letters. An SEC comfort letter tells the recipients that the SEC agrees not to bring further enforcement against them. As far as I know, these letters are not published anywhere, but searching the SEC Web site - or securities-related news sources - might turn up a related article, SEC statement, litigation release or enforcement action.

See Also
American Institute of Certified Public Accountants
Auditing Standards
Securities and Exchange Commission
Securities Laws

For comments, questions and suggestions, email the author
Copyright 2015 Andrew Zimmerman