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II
116TH CONGRESS
1ST SESSION
S. 452
To amend the Sarbanes-Oxley Act of 2002 to provide a temporary exemption
for low-revenue issuers from certain auditor attestation requirements.
IN THE SENATE OF THE UNITED STATES
FEBRUARY 12, 2019
Mr. TILLIS (for himself, Mr. PETERS, Mr. PERDUE, and Ms. SINEMA) intro-
duced the following bill; which was read twice and referred to the Com-
mittee on Banking, Housing, and Urban Affairs
A BILL
To amend the Sarbanes-Oxley Act of 2002 to provide a
temporary exemption for low-revenue issuers from certain
auditor attestation requirements.
Be it enacted by the Senate and House of Representa-
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tives of the United States of America in Congress assembled,
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SECTION 1. SHORT TITLE.
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This Act may be cited as the ‘‘Fostering Innovation
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Act of 2019’’.
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•S 452 IS
SEC. 2. TEMPORARY EXEMPTION FOR LOW-REVENUE ISSU-
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ERS.
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Section 404 of the Sarbanes-Oxley Act of 2002 (15
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U.S.C. 7262) is amended by adding at the end the fol-
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lowing:
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‘‘(d) TEMPORARY EXEMPTION FOR LOW-REVENUE
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ISSUERS.—
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‘‘(1) DEFINITIONS.—In this subsection—
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‘‘(A) the term ‘average annual gross reve-
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nues’ means the total gross revenues of an
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issuer over its most recently completed 3 fiscal
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years divided by 3;
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‘‘(B) the term ‘emerging growth company’
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has the meaning given the term in section 3 of
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the Securities Exchange Act of 1934 (15
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U.S.C. 78c); and
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‘‘(C) the term ‘large accelerated filer’ has
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the meaning given the term in section 240.12b–
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2 of title 17, Code of Federal Regulations (or
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any successor regulation).
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‘‘(2) LOW-REVENUE
EXEMPTION.—Subsection
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(b) shall not apply with respect to an audit report
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prepared for an issuer that—
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‘‘(A) ceased to be an emerging growth
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company on the last day of the fiscal year of
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the issuer following the 5-year period beginning
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•S 452 IS
on the date of the first sale of common equity
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securities of the issuer pursuant to an effective
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registration statement under the Securities Act
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of 1933 (15 U.S.C. 77a et seq.);
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‘‘(B) had average annual gross revenues of
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less than $50,000,000 as of its most recently
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completed fiscal year; and
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‘‘(C) is not a large accelerated filer.
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‘‘(3) EXPIRATION
OF
TEMPORARY
EXEMP-
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TION.—An issuer ceases to be eligible for the exemp-
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tion described under paragraph (1) on the earlier
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of—
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‘‘(A) the last day of the fiscal year of the
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issuer following the 10-year period beginning on
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the date of the first sale of common equity se-
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curities of the issuer pursuant to an effective
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registration statement under the Securities Act
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of 1933 (15 U.S.C. 77a et seq.);
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‘‘(B) the last day of the fiscal year of the
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issuer during which the average annual gross
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revenues of the issuer exceed $50,000,000; or
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‘‘(C) the date on which the issuer becomes
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a large accelerated filer.’’.
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Æ
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