Pink Current Status Requires Financials in a Specific Format
Achieving Pink Current status is worthwhile for any Issuer listed on the Pink Sheets, since it provides investors with the confidence that comes from being a fully reporting company under the Alternate Reporting Standard. In order for an Issuer on the OTCMarkets Pink Sheets to maintain its status as “Pink Current” the Company must file both Quarterly and Annual financial reports when due. Many Pink Sheet Issuers discover that OTCMarkets requires these financials in a specific format, which is sometimes not what their bookkeeper provides at tax time. There is also a specific way the financials should be posted within the OTC Disclosure and News Service so that they clearly state for which “period end” the financials apply.
Many Issuers Post Inadequate or Improper Financials in OTCIQ and Stay at Yield Sign
Many times, Issuers post inadequate or improperly formatted financials and wonder why they stay at a Yield Sign (Pink Limited Information). When this happens, an Issuer must go back and reformat the financials in order to comply with OTCMarkets guidelines, which sometimes requires emails with OTCMarkets staff. It is easy enough for management or an Issuer’s securities counsel to delete the improper reports and upload new PDFs showing the correct format which OTCMarkets requires. Although the OTC staff is always helpful, and willing to assist Issuers learning the OTCIQ process, working with an experienced microcap securities attorney can help do things right the first time, saving accounting costs with some planning beforehand. At the Law Office of Matheau J. W. Stout, Esq., we often serve as corporate counsel to Pink Sheet companies, and serve as authorized user on OTCIQ so that we can make sure the postings are done correctly each time. This saves Issuers considerable time so management can focus on operating the business rather than on the legal and administrative aspects of reporting.
OTCMarkets Requires Issuers to Post a Balance Sheet, Profit & Loss Statement and Cash Flow Statement
Each of these reports should state the Issuer’s corporate name in the heading, as well as the “period end” date, such as September 30, 2013. Quickbooks has the ability to format the Quarterly Report properly, so long as the user specifies the parameters and requests a Balance Sheet, P&L and Cash Flow Statement. Taking the time to format these properly once will save considerable time and expense later, since each Quarter the same reports will be posted. Consolidated reports can be used by Issuers having multiple subsidiaries, so long as this is clearly disclosed. OTCMarkets provides helpful information for Issuers on all aspects of using the OTIQ service, including an article on how to save financials to a PDF. Issuers interested in obtaining Pink Current Status can begin the process by reviewing an OTCIQ Agreement and submitting it to OTCMarkets.com.