Sarbanes-oxley act of 2002

TITLE IV—ENHANCED FINANCIAL 
DISCLOSURES 
SEC. 401. ø15 U.S.C. 7261¿ DISCLOSURES IN PERIODIC REPORTS. 
(a) 
(b) C
OMMISSION
R
ULES ON
P
RO
F
ORMA
F
IGURES
.—Not later 
than 180 days after the date of enactment of the Sarbanes-Oxley 
Act fo 2002, the Commission shall issue final rules providing that 
pro forma financial information included in any periodic or other 
report filed with the Commission pursuant to the securities laws, 
or in any public disclosure or press or other release, shall be pre-
sented in a manner that— 
(1) does not contain an untrue statement of a material fact 
or omit to state a material fact necessary in order to make the 
pro forma financial information, in light of the circumstances 
under which it is presented, not misleading; and 
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As Amended Through P.L. 116-222, Enacted December 18, 2020

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41 Sec. 
403 
SARBANES-OXLEY ACT OF 2002 
(2) reconciles it with the financial condition and results of 
operations of the issuer under generally accepted accounting 
principles. 
(c) S
TUDY AND
R
EPORT ON
S
PECIAL
P
URPOSE
E
NTITIES
.— 
(1) S
TUDY REQUIRED
.—The Commission shall, not later 
than 1 year after the effective date of adoption of off-balance 
sheet disclosure rules required by section 13(j) of the Securities 
Exchange Act of 1934, as added by this section, complete a 
study of filings by issuers and their disclosures to determine— 
(A) the extent of off-balance sheet transactions, includ-
ing assets, liabilities, leases, losses, and the use of special 
purpose entities; and 
(B) whether generally accepted accounting rules result 
in financial statements of issuers reflecting the economics 
of such off-balance sheet transactions to investors in a 
transparent fashion. 
(2) R
EPORT
AND
RECOMMENDATIONS
.—Not later than 6 
months after the date of completion of the study required by 
paragraph (1), the Commission shall submit a report to the 
President, the Committee on Banking, Housing, and Urban Af-
fairs of the Senate, and the Committee on Financial Services 
of the House of Representatives, setting forth— 
(A) the amount or an estimate of the amount of off- 
balance sheet transactions, including assets, liabilities, 
leases, and losses of, and the use of special purpose enti-
ties by, issuers filing periodic reports pursuant to section 
13 or 15 of the Securities Exchange Act of 1934; 
(B) the extent to which special purpose entities are 
used to facilitate off-balance sheet transactions; 
(C) whether generally accepted accounting principles 
or the rules of the Commission result in financial state-
ments of issuers reflecting the economics of such trans-
actions to investors in a transparent fashion; 
(D) whether generally accepted accounting principles 
specifically result in the consolidation of special purpose 
entities sponsored by an issuer in cases in which the issuer 
has the majority of the risks and rewards of the special 
purpose entity; and 
(E) any recommendations of the Commission for im-
proving the transparency and quality of reporting off-bal-
ance sheet transactions in the financial statements and 
disclosures required to be filed by an issuer with the Com-
mission. 
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