THE FREQUENT FILER
Navigating EDGAR Next: What Filers Need to Know About SEC's Latest Update
The Securities and Exchange Commission (SEC) has announced significant updates to its Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system, under a new initiative called EDGAR Next. These changes, outlined in the “Final Rule on EDGAR Filer Access and Account Management,” are designed to modernize the platform, improve security, and make managing accounts more efficient for electronic filers.
Overview of EDGAR Next
The EDGAR Next initiative introduces several amendments to the system, which will be implemented gradually, with full compliance required by September 2025. These updates aim to address existing gaps in account security, reduce potential risks, and make the system more user-friendly for companies and individuals submitting filings to the SEC.
Key Goals:
- Enhancing Security: By introducing mandatory individual account credentials and multifactor authentication, EDGAR will now align with modern cybersecurity practices. Filers will use the government’s Login.gov platform to authenticate themselves, adding a crucial layer of protection.
- Role-Based Access Control: EDGAR Next emphasizes managing accounts via designated Account Administrators. Filers must assign these administrators who will manage all interactions with EDGAR, including filing submissions, user management, and API connections.
- Optional APIs: To further streamline access, EDGAR Next will offer Application Programming Interfaces (APIs), enabling machine-to-machine communication, making the filing process more efficient for those who choose to implement this feature.
- User-Friendly Interface: The new EDGAR dashboard will provide an intuitive way for administrators to manage user roles, access security tokens, and ensure all account data remains up to date.
Transition Timeline
The changes come into effect in stages:
March 24, 2025: EDGAR’s dashboard goes live, introducing the new access system and Login.gov integration. Form ID applications will begin to reflect these updates.
September 15, 2025: All filers must be in full compliance, including using the new credentials and APIs for those opting into machine-to-machine filing. Those not enrolled will not be able to make submissions or use EDGAR.
December 2025: A final transition period allows filers to complete enrollment, ensuring full adoption of the new system.
(This info is also available here at page 102)
The EDGAR Business Office (EBO) is hosting live EDGAR Next kick-off webinars to demonstrate functions and answer questions. The EBO invites filers to register for any one or more of the following live webinars:
- Tuesday, October 8, 2024, from 1 p.m. to 2 p.m. ET*
- Wednesday, October 23, 2024, from 2 p.m. to 3:30 p.m. ET
- Thursday, November 7, 2024, from 11 a.m. to 12:30 p.m. ET
*A recording of the webinar will be posted to the SEC’s YouTube channel.
Benefits for Filers
- Increased Security: By requiring individual credentials for all users, EDGAR ensures that each action taken on behalf of a filercan be tracked to a specific individual. This accountability reduces the chances of fraud or unauthorized access.
- Improved Management: Filers will benefit from having designated Account Administrators responsible for overseeing and confirming all user access, reducing the risk of mismanagement.
- Automation via APIs: For large filers or frequent submitters, the optional APIs allow direct integration with EDGAR, bypassing manual data entry and streamlining the entire process.
- Clear Transition Path: The multi-phase rollout gives filers ample time to adjust, test the new system, and ensure smooth compliance with the changes.
Challenges to Consider
While EDGAR Next introduces a range of benefits, the transition may pose challenges, particularly for small filers or those with complex corporate structures. The introduction of new roles and the need to assign technical administrators for API access adds layers of responsibility that may require extra resources and planning.
Moreover, some concerns have been raised over the use of Login.gov, as it is already widely used for personal matters, like Social Security. Individuals managing multiple accounts may face additional complexities in separating their professional and personal logins. However, the SEC has built flexibility into the system, allowing filers to authorize third parties as their account administrators if necessary.
Conclusion
The SEC’s EDGAR Next represents a long-overdue modernization of the EDGAR system, prioritizing security and ease of use. While the changes may require an adjustment period for filers, the long-term benefits of enhanced security, accountability, and process efficiency should outweigh any initial hurdles. Filers are encouraged to start preparing early to ensure a smooth transition by the 2025 deadlines.
One key feature of EDGAR Next is that filers can delegate authority to an unlimited number of EDGAR accounts, allowing them to work with multiple filing agents. However, it is imperative for anyone we currently work with—or may work with in the future—to ensure that we are a delegated authority on their EDGAR account. This ensures we can assist quickly and efficiently, particularly in any last-minute scenarios that may arise.
At EA, we are up to date with all EDGAR Next developments, and clients can be fully assured they are supported by a team of experts ready to guide them through every step of the process.
Stay tuned here for more updates as the SEC releases further details on the implementation of these critical changes.
About EA
EdgarAgents (commonly referred to as EA) is an industry leading, full-service SEC filing agent and financial printer specializing in financial regulatory and compliance solutions for investment management companies, Exchange Traded Funds, public and private companies, fund administrators, private equity firms, corporate attorneys, investment banks and other financial institutions. EA seamlessly supports both transactional and regulatory reporting for ongoing shareholder communication services across public markets including, but not limited to NYSE and NASDAQ.
EdgarAgents provides a comprehensive suite of services and solutions tailored to meet your specific needs. EA’s offerings encompass EDGAR conversion, inline XBRL tagging, typesetting and design, virtual data rooms (VDR), SaaS technology solutions, ADA document and website compliance, web hosting & eDelivery, language translations, news distribution, and printing of shareholder communications. Annually, EdgarAgents successfully processes over 40,000 filings, demonstrating our robust capability and industry leadership.
EA efficiently delivers the highest quality at 3x speed, maximizing value for clients, guaranteed! Learn more at www.edgaragents.com, on LinkedIn, or by contacting antoinettebehan@edgaragents.com or +1-212-265-3347.
