The NASPP Blog

March 10, 2009

EDGAR Passwords: One Less Thing To Do

When I read suggestions for best practices for Section 16 reporting, I often see keeping your insiders’ EDGAR passwords current included as a critical procedure.  I disagree–I think it is a waste of time to keep your insiders’ EDGAR passwords current.

EDGAR Password: What Is It Good For?

An EDGAR password is necessary only to log onto the EDGAR filing websites, such as the EDGAR OnlineForms Management website used for Section 16 filings.  It is not included in EDGAR filings and an insider’s EDGAR password does not need to be current for you to submit filings on his or her behalf.  My guess is that your insiders never have occasion to log onto the EDGAR filing websites; in fact, you probably discourage them from doing this for fear they will inadvertently mess something up. 

If you have your own CIK number, the only reason you would need to log onto the EDGAR filing websites under your insiders’ CIKs would be if you needed to update their account information.  There’s not a whole lot of account information stored on EDGAR, it’s mainly just the insiders’ addresses.  And, since most of your insiders probably list their work address, these addresses probably don’t change that often. 

Get Your Own CIK

I recommend that you have your own CIK number with your own password.  This gives you access to the EDGAR OnlineForms Management website and ensures that no one can accidentally change the password and forget to tell you.  Once you have logged onto the EDGAR OnlineForms Management website under your own CIK, you can submit filings on behalf of all your insiders without re-logging in under their CIKs.

It’s easy to obtain your own CIK; you use the same process that you go through to obtain EDGAR codes for a new insider, except when you complete Form ID, you indicate that you are a “filing agent” rather than a “filer.” You simply go to the EDGAR Filer Management website, click the link to “Apply for EDGAR Access (New),” complete the form (be sure to specify that you are a “filing agent,” not a “filer”), print it out and have it notarized, fax the notarization to the SEC, then wait for your CIK and passphrase. When you receive your CIK and passphrase, go back to the EDGAR Filer Management website to generate your other EDGAR codes, including your password.

Once you have your own CIK, you can use it to log onto the EDGAR website and the only password you’ll need to maintain will be your own.  You can let your insiders’ passwords expire and you will still be able to submit filings on their behalf.  None of your information is included in their filings (you still include their CIK and CCC in the EDGAR submission, you are just using your CIK and password to log onto the EDGAR OnlineForms Management website), so the filings won’t look any different than if you were logging onto the website using their CIK. 

What If I Need to Update Insider Account Data?

If an insider’s password has expired, you can easily and quickly generate new EDGAR access codes, including a new password, via the EDGAR Filer Management website (this will generate a new CCC for the insider as well, so be sure to notify anyone else that submits filings on behalf of the insider of the new CCC and password).  It seems to me that it is easier to do this in the rare situations where you need to log onto EDGAR using an insider’s CIK than to keep track of all your insiders’ EDGAR passwords and update them every year.

Answers to All Your Section 16 Questions
Section16.net is a fabulous resource for anyone responsible for Section 16 compliance.  It includes the complete text of Romeo & Dye’s Section 16 Forms and Filing Handbook, Alan Dye’s blog on Section 16 developments, and Q&A forums on EDGAR filing procedures and general Section 16 reporting questions.  Alan, the industry’s foremost authority on Section 16, frequently answers questions posted to the forums, making Section16.net your direct line to Alan Dye.  No one should be without this resource!

Reason #16 to Renew Your NASPP Membership: The NASPP Compliance-O-Meter
The NASPP Compliance-O-Meter is a quick and fun way of evaluating your own compliance procedures and comparing them to your peers’. We feature a monthly quiz of just four or five questions that focus on an area of stock plan compliance.  The questions are easily in just ten minutes or less answered–no research required. Once you’ve answered the questions, you’ll be able to see how your answers compare with everyone else’s and you can read explanations of each procedure.  Take this month’s quiz on Reconciling Stock Plan Balances today and visit the archive of past quizzes. 

NASPP “To Do” List
We have so much going on here at the NASPP that it can be hard to keep track of it all, so I keep an ongoing “to do” list for you here in my blogs. 

– Barbara