Securities Lawyer's Deskbook                          published by The University of Cincinnati College of Law

Rule 3-09 -- Separate Financial Statements of Subsidiaries Not Consolidated and 50 Percent or Less Owned Persons

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1. If any of the conditions set forth in Rule 1-02(w), substituting 20 percent for 10 percent in the tests used therein to determine a significant subsidiary, are met for a majority-owned subsidiary not consolidated by the registrant or by a subsidiary of the registrant, separate financial statements of such subsidiary shall be filed. Similarly, if either the first or third condition set forth in Rule 1-02(w), substituting 20 percent for 10 percent, is met by a 50 percent or less owned person accounted for by the equity method either by the registrant or a subsidiary of the registrant, separate financial statements of such 50 percent or less owned person shall be filed.
   
   
2. Insofar as practicable, the separate financial statements required by this section shall be as of the same dates and for the same periods as the audited consolidated financial statements required by Rule 3-01 and Rule 3-02. However, these separate financial statements are required to be audited only for those fiscal years in which either the first or third condition set forth in Rule 1-02(w), substituting 20 percent for 10 percent, is met. For purposes of a filing on Form 10-K:
   
   
   1. If the registrant is an accelerated filer (as defined in Rule 12b-2) but the 50 percent or less owned person is not an accelerated filer, the required financial statements may be filed as an amendment to the report within 90 days, or within six months if the 50 percent or less owned person is a foreign business, after the end of the registrant's fiscal year.
      
      
   2. If the fiscal year of any 50 percent or less owned person ends within the registrant's number of filing days before the date of the filing, or if the fiscal year ends after the date of the filing, the required financial statements may be filed as an amendment to the report within the subsidiary's number of filing days, or within six months if the 50 percent or less owned person is a foreign business, after the end of such subsidiary's or person's fiscal year.
      
      
   3. The term registrant's number of filing days means:
      
      
      1. 60 days (75 days for fiscal years ending before December 15, 2006) if the registrant is a large accelerated filer;
         
         
      2. 75 days if the registrant is an accelerated filer; and
         
         
      3. 90 days for all other registrants.
         
         
   4. The term subsidiary's number of filing days means:
      
      
      1. 60 days (75 days for fiscal years ending before December 15, 2006) if the 50 percent or less owned person is a large accelerated filer;
         
      2. 75 days if the 50 percent or less owned person is an accelerated filer; and
         
         
      3. 90 days for all other 50 percent or less owned persons.
         
3. Notwithstanding the requirements for separate financial statements in paragraph (a) of this section, where financial statements of two or more majority-owned subsidiaries not consolidated are required, combined or consolidated statements of such subsidiaries may be filed subject to principles of inclusion and exclusion which clearly exhibit the financial position, cash flows and results of operations of the combined or consolidated group. Similarly, where financial statements of two or more 50 percent or less owned persons are required, combined or consolidated statements of such persons may be filed subject to the same principles of inclusion or exclusion referred to above.
   
   
4. If the 50 percent or less owned person is a foreign business, financial statements of the business meeting the requirements of Item 17 of Form 20-F will satisfy this section.
   
   

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