Advances in SEC reporting process: 40-year retrospective.

• Author: Bonney, Nadine
• Position: FINANCIAL REPORTING - Securities and Exchange Commission

Early career professionals may occasionally stumble upon their parents' record collection, cassette tapes or typewriter and reflect on the significant technology changes. Many of the technologies and filing standards that U.S. Securities and Exchange Commission reporting teams take for granted today--or assess as nearing their end of life--were shiny and new and very disruptive not too long ago.

The regulatory requirements associated with SEC reporting and nuances of financial reports have contributed to a slower technology adoption curve than is evident in other parts of the enterprise, but major changes are now occurring at many companies. Innovation, along with the SEC's push for greater transparency, has led to some significant changes in SEC reporting processes. Highlighted below are some of the key contributors over the last 40 years as well as speculation on what some of the next key changes might entail.

1972--The Fax Machine. The first intercity facsimile transmission is reported to have been made in 1907 between Munich and Berlin. Xerox Corp., introduced what many consider the first commercial version of the modern fax machine in 1964 and continued to make refinements.

Facsimile machines, as they were referred to in 1972, were large bulky devices. Like the photocopier at that time, fax machines were relegated to a single room for shared use. Both machines greatly facilitated sharing of documents between the registrant, outside counsel and auditors. The curly thermal facsimile paper was a pain to deal with, however. Cutting pages was tedious as was transmitting notes written on the thermal paper, which was prone to fading and smudging.

Desktop fax machines became mainstream for finance teams circa 1982, which facilitated more timely and expanded review of documents by the various constituents. Built-in page cutters and plain paper faxes came out in the mid-'80s, which greatly improved the experience.

SEC documents were typically typed using an IBM Se-lectric II typewriter (which was released in 1971). Liquid Paper's whiteout correction fluid was a lifesaver in making corrections without having to retype an entire page.

Remote collaboration was challenging and participants in the review process would often travel to meet in person to complete the final documents. The final drafting was often performed at a financial printer (RR Donnelley & Sons Co. and Bowne & Co. were the two largest financial printers) to facilitate the...