Mind your manners: etiquette can go a long way toward getting results with the SEC.

• Author: Wild, Sam
• Position: SECCommunications

Etiquette can go a long way toward getting results with the U.S. Securities and Exchange Commission. You can reach more business goals when you work in cooperation with the SEC rather than take an adversarial approach.

If you are a CFO or director of finance at a public company, consider these six tips for working effectively with the SEC.

1. Ask the SEC official for help with resolving an issue. When a complex issue arises, such as recognizing income, it often helps to invite the SEC official to take part in creating a solution. If you work in this fashion, the SEC will be aware of your approach from the start. Also, hearing the views of the SEC staff may actually help you strengthen your position prior to taking action and minimize the surprises for both sides.

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   Keep in mind that the SEC staff may have an education and background that is similar to yours, so you may have more in common than you think. While the SEC staff realizes that many issues are not black or white, these professionals quickly sense when an accounting method does not smell right.

2. Provide as much information as possible. Even if the information does not necessarily support your position, present all you can. By sharing everything, you increase your credibility with SEC officials.

   Support your position by citing generally accepted accounting principles and referring to standard industry practices. You also can help your case by sharing opposing viewpoints and giving your reasons for disregarding them.

   In short, don't give the SEC the impression that you are showing only what you want them to see. If SEC officials believe that you are holding back, that belief will bring out a natural inclination for them to dig in like a terrier.

3. Put it in writing. You would be surprised at how many companies communicate with the SEC in a haphazard manner. Public companies can't afford to make sloppy mistakes. Many CFOs, when faced with issue and time pressures, make an informal call to the SEC's Department of Corporate Finance. You want to define the issue carefully and succinctly. Phone discussions have a tendency to change after the fact, so if you want a decision to be binding, put it in writing and ask the SEC to respond with an acknowledgement.

   Remember, a verbal opinion is worth the paper it is written on. To expedite matters, offer to summarize the results of your conference and share it with them.

4. Follow procedures. Every culture has etiquette and...