Updating Form 10-K for fiscal year 2025 and other annual reporting

Now that 2026 has begun, United States public companies with a December 31 fiscal year-end will be working to prepare their annual reports on Form 10-K for filing with the US Securities and Exchange Commission (SEC).

Unlike prior years, there are no new SEC disclosure requirements for fiscal year-end 2025 Forms 10-K. Instead, the focus will be on updating disclosures to address financial performance, changes in the regulatory and geopolitical environment since the beginning of fiscal year 2025, and other events that impacted companies’ operations during such period.

Companies are encouraged not only to meet relevant SEC requirements, but also to understand disclosure trends and expectations – including how changing priorities at the SEC may impact disclosure requirements in the near future.

This article addresses the following topics:

Form check for requirements

Preparers of Form 10-K are encouraged to familiarize themselves with Form 10-K’s disclosure requirements, which incorporate requirements from other SEC rules and regulations, such as Regulation S-K and relevant SEC guidance; learnings from enforcement actions; and other disclosure trends.

Some key tasks that may warrant special attention include:

• Determining a company’s filer status and filing deadline
  
  
• Verifying and completing the Form 10-K cover page
  
  
• Updating the “Business,” “Risk Factors,” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” (MD&A) sections for developments and trends in the company’s business, markets, and industry during the most recently completed fiscal year
  
  
• Filing material contracts and other required information as exhibits and updating the exhibit index, as necessary, to remove exhibits that are no longer applicable

Other disclosure considerations for Form 10-K

Public companies are also encouraged to consider topics that have commanded the SEC’s and investors’ interests and, if material to their businesses, provide necessary disclosures in the relevant sections of Form 10-K, such as:

• Financial disclosures
• Climate-related matters
• Artificial intelligence (AI)
• Digital assets
• Cybersecurity

Other annual reporting and compliance issues

In addition to the disclosure obligations contained in Form 10-K and the proxy statement, companies are encouraged to prepare for other annual reporting obligations, such as those required by Form SD. DLA Piper will cover preparation of the proxy statement in a future publication.

New SEC administration and shift in priorities

The SEC administration under Chairman Paul Atkins has signaled a focus on facilitating innovation in the US, particularly with respect to digital assets, reducing compliance burdens related to capital formation, and modernizing disclosure requirements for public companies, while not losing sight of investor protection. The SEC’s regulatory agenda is likely to result in new rulemaking in 2026 that could ease reporting requirements for Form 10-K in future years. Further below, this article discusses some of the potential changes to Form 10-K, and public company reporting generally, that may be proposed in 2026.

Drafting Form 10-K

Determine filer status and deadlines

Filer status

As an initial step, a company should determine its filer status according to Rule 12b-2 of the Securities and Exchange Act of 1934, as amended (Exchange Act), as the outcome of that assessment will determine the filing deadline and, in some cases, the level of disclosure required.

To qualify as a Large Accelerated Filer (LAF), a company must meet the following criteria as of the end of its fiscal year:

• Has a public float of at least $700 million as of the last business day of its most recently completed second fiscal quarter (June 30, 2024 for calendar year-end companies)
  
  
• Has been an SEC reporting company for at least 12 months
  
  
• Has filed at least one Annual Report on Form 10-K, and
  
  
• Does not meet the revenue test to be eligible to qualify as a Smaller Reporting Company (SRC).

The LAF filing deadline is 60 days following the end of the fiscal year (March 2, 2026 for calendar year-end LAFs).

To qualify as an Accelerated Filer (AF), a company must meet the following criteria as of the end of its fiscal year:

• Has a public float of at least $75 million but less than $700 million as of the last business day of its most recently completed second fiscal quarter
  
  
• Has been an SEC reporting company for at least 12 months
  
  
• Has filed at least one Annual Report on Form 10-K, and
  
  
• Does not meet the revenue test to be eligible to qualify as an SRC.

The AF filing deadline is 75 days following the end of the fiscal year (March 16, 2026 for calendar year-end AFs).

A company that is neither an LAF nor an AF, referred to as a Non-Accelerated Filer, must file Form 10-K within 90 days following the end of the fiscal year (March 31, 2026 for calendar year-end companies).

For other SEC reporting deadlines, see this calendar showing SEC filing deadlines and financial statement staleness dates for 2026.

In addition, a company can determine whether it still qualifies as an Emerging Growth Company (EGC) and/or an SRC, which would allow it to make scaled or reduced disclosure.

A company is an EGC if it had annual gross revenues of less than $1.235 billion during its most recently completed fiscal year, unless it first sold common equity pursuant to an effective Securities Act of 1933 registration statement on or before December 8, 2011. A company loses its EGC status upon the occurrence of any of the following:

• The end of the fifth fiscal year following its IPO
  
  
• The last day of the first fiscal year in which its annual gross revenue exceeds $1.235 billion
  
  
• The date it becomes an LAF, or
  
  
• The date on which it has issued more than $1 billion in nonconvertible debt during the preceding three-year period.

An SRC is a company (other than an investment company, asset backed issuer, or a majority-owned subsidiary of a parent that is not an SRC) that:

• Had a public float of less than $250 million as of the last day of its most recently completed second fiscal quarter or
  
  
• Had less than $100 million in annual gross revenue during its last fiscal year and had either

• No public float or
• Less than $700 million in public float

Any changes in LAF, AF, or Non-Accelerated Filer status will take effect on the last day of the fiscal year. Consequently, companies are encouraged to consider whether they have maintained their filer status for fiscal year 2025, as a change could have significant disclosure and timing implications for their Forms 10-K – such as the requirement to include an auditor’s attestation report on the company’s internal control over financial reporting (ICFR).

Notably, companies that lose SRC status as of fiscal year-end must cease using scaled SRC disclosures starting with the Form 10-Q for the first quarter of the subsequent fiscal year. Meanwhile, companies that qualify as SRCs as of the fiscal year-end can begin using scaled SRC disclosures in their upcoming Form 10-K.

In August 2025, the SEC’s Division of Corporation Finance published guidance in the form of Question 130.05 (C&DI 130.05) of Securities Exchange Act Rules C&DIs regarding when a company may become an AF or an LAF after losing its SRC status. C&DI 130.05 explains that, if a company no longer qualifies as an SRC because it does not satisfy the SRC requirements on the last business day of its second fiscal quarter, it would not qualify as an LAF or an AF as of the end of the fiscal year, because these definitions require that the company not be able to qualify as an SRC under the revenue test.

However, under the definition of SRC under Rule 12b-2 of the Exchange Act, a company can continue to satisfy the requirements of an SRC until its Form 10-Q for the first fiscal quarter of its next fiscal year. Accordingly, a company that determines that it no longer qualifies as an SRC because its public float exceeded the SRC requirement on June 30, 2025 would become a Non-Accelerated Filer for the upcoming fiscal year and file its Form 10-K within 90 days of its fiscal year-end. It would also be ineligible to report as an SRC beginning with its Form 10-Q for the first fiscal quarter of 2026.

Review information on Form 10-K cover page

The cover page of Form 10-K contains boxes that are intended to confirm certain information, including the company’s:

• Voluntary filer status
  
  
• Compliance with filing requirements under Section 13 or 15(d) of the Exchange Act during the previous 12 months
  
  
• Filing of interactive data exhibits during the previous 12 months
  
  
• Filing of attestation reports regarding the effectiveness of ICFR under Section 404(b) of the Sarbanes-Oxley Act of 2002 (Sarbanes-Oxley)
  
  
• Shell company status
  
  
• Clawback checkbox requirement:

As discussed in a previous DLA Piper client alert, companies must check a box to indicate whether the financial statements included in the filing reflect the correction of an error to previously issued financial statements. If any of the error corrections are restatements that required a recovery (or “clawback”), analysis under relevant stock exchange listing standards, and Rule 10D-1 of the Exchange Act, a second box must be checked. The SEC staff has stated that a company must check the second box, even if the company ultimately determines that no clawback of an incentive-based award was required after conducting the recovery analysis.

Companies are required to disclose other information on the cover page, some of which is not likely to change from year to year, such as the titles and classes of securities that are registered under the Exchange Act and their principal executive office addresses and telephone numbers. When completing the cover page, the preparer is encouraged to conduct the necessary internal inquiries to ensure the accuracy of the information.

Business

Form 10-K preparers are encouraged to carefully review last year’s “Business” section disclosure under Item 1 of Form 10-K to determine whether updates are necessary to reflect 1) new product or service offerings or changes in business strategy, 2) completed material acquisitions or dispositions, 3) regulatory updates, or 4) changes in the competitive landscape that could materially affect a company’s operations. Reviewing the disclosures of a company’s competitors or peers may be instructive in identifying key industry trends and regulatory developments.

As companies continue to develop or enhance artificial intelligence (AI) strategies for their products or services, they are encouraged to evaluate whether their previous AI-related disclosures are still accurate, including how management and the board provide appropriate oversight for the company’s AI-related activities. See the expanded discussion below under “Additional disclosure considerations.”

In addition, Item 101(c) of Regulation S-K requires companies to provide principles-based disclosure regarding the human capital measures or objectives on which they focus in managing their businesses; many companies discuss programs and metrics related to the recruitment, retention, and development of their employees. Companies may consider whether any updates should be made to their human capital resources disclosure to not only reflect changes to the number of employees, but also material changes to programs and initiatives impacting their workforce.

In particular, following the issuance of Executive Order (EO) 14151, titled, “Ending Radical and Wasteful Government DEI Programs,” the Trump Administration has focused on eliminating diversity policies, programs, and practices identified as illegal through EOs, investigations, and enforcement actions. For example, in 2025, the US Attorney General issued memoranda indicating that the US Department of Justice (DOJ) will investigate, eliminate, and penalize illegal DEI activities, including in the private sector.

Prior to 2025, many companies included descriptions of their employee diversity programs, including metrics related to the gender and racial/ethnic composition of their workforce and the prevalence of affinity groups, as part of the discussion of their human capital measures or objectives. Companies are encouraged to evaluate their programs and initiatives in light of EO 14151 and the potential implications of the resulting disclosures.

Risk factors

Item 1A of Form 10-K, the “Risk Factors” section, requires companies to disclose the material factors that make an investment in the company’s securities speculative or risky. This section calls for regular and careful analysis of the risks faced by the company, which may change over time. The SEC has stressed that risk factor disclosures should concentrate on the materiality of the risk to the specific company. Companies are encouraged to include risk factors tailored to the company, rather than generic risks applicable to all companies, unless the company is particularly susceptible to such risks.

Nevertheless, certain risks can have substantially similar impact on any company within a specific industry or geography or under common regulatory oversight. Companies often benchmark their risk factor disclosures against those of other companies in their industry to compare how peer companies describe the common challenges they face.

The annual filing of Form 10-K presents an opportunity for a company to carefully reevaluate and update its risk factors to reflect any new or evolving risks, as well as update aspects of risk factor disclosure that have materialized and no longer represent only hypothetical risks, as discussed below.

To understand shifts in risk factor disclosure trends since the 2025 Form 10-K filing season, DLA Piper’s Corporate Data Analytics team evaluated risk factors included in 217 Forms 10-K filed by Russell 3000 companies in the period between June 30 and November 25 in each of 2024 and 2025. A summary of the findings is included in Appendix A.

Among other trends, the team’s data indicates that there was a significant increase in the disclosure of risk factors related to AI and global trade in 2025 compared to the same period in 2024.

Key areas that may warrant new or updated risk factor disclosure in 2026 include:

• AI: Depending on how AI is integrated into a company’s products, services, markets, or day-to-day operations, or the company’s potential exposure to AI-related technologies through vendors, customers, and other service providers, companies are encouraged to assess the nature, extent, and impact that AI-related risks may present for their businesses – including how regulatory developments in the AI space may impact a company’s plans for growth and expansion. Relevant disclosure could include risks related to existing and future laws pertaining to AI and its use. Further, companies may consider disclosing risks regarding the potential for litigation or enforcement actions related to the company’s use of and exposure to AI.
  
  
• Cybersecurity: To the extent a company has experienced cyber breaches – whether or not disclosed pursuant to Item 1.05 of Form 8-K – or has identified new and specific vulnerabilities to its information systems, it is encouraged to reassess its cyber risk factor disclosure to ensure that it captures all material risks. Companies are also encouraged to consider whether their disclosures have the appropriate level of specificity and detail regarding cybersecurity risks. For example, a statement that a company’s systems “may be” vulnerable to damage or interruption as a result of cybersecurity attacks, rather than a statement that the systems “are,” may not be sufficiently clear and definitive to warn investors of the risks.
  
  
• Geopolitical events: The continuing effects of international conflicts, such as in Ukraine, Venezuela, and the Middle East – and how such events have impacted or could impact the company’s business – may be reevaluated to determine whether any new disclosures are warranted, or whether existing disclosures should be updated.
  
  
• Global trade and tariffs: If they have not already done so in a prior periodic filing, companies are encouraged to consider disclosing the impact of tariffs introduced as part of the Trump Administration’s “Liberation Day” strategy. Potential risks could include uncertainty related to modifications to the scope (e.g., the goods and countries included) and the impact of tariffs, increased costs for materials needed for production, a decrease in sales resulting from higher prices related to US tariffs or reciprocal tariffs imposed by other countries on US goods, and supply chain challenges.
  
  
• Climate change: Consider monitoring any material climate-related risks, including the physical impacts of climate events, risks caused by transitions to sustainable business practices, and the costs related to compliance with regulatory or commercial requirements. In addition, companies are encouraged to discuss the uncertainty regarding the adoption of climate-related regulations both in the US and abroad and any potential negative impacts that may result (see “Climate disclosure” below).
  
  
• Diversity: As discussed above, in light of the Trump Administration’s focus on illegal DEI activities, companies are encouraged to disclose risks related to whether any of their programs and policies supporting diversity could result in enforcement actions by the DOJ or other federal regulators. In addition, companies may want to consider and disclose any risks related to opposition from shareholders, employees, or customers in connection with maintaining, eliminating, or modifying any diversity programs or initiatives.
  
  
• Regulatory changes: The election of a new US presidential administration has resulted and may continue to result in changes to regulatory priorities. Risk factor disclosure could discuss the impact of such changes, including new rules and regulations, the relaxation or elimination of prior regulations and policies, differences in protocols for interacting with regulators and federal agencies, and how failure to navigate the regulatory environment may negatively impact operations.
  
  
• Government shutdown: In 2025, the federal government was shut down for 43 days, during which companies relying on revenues from contracting with the federal government did not receive payment. Companies are encouraged to assess any lingering effects that the shutdown may have on their results of operations and financial position. Notably, the government spending bill that ended the recent shutdown is only scheduled to fund the federal government through January 30, 2026. Accordingly, discussion of potential negative impacts to a company’s business resulting from another federal government shutdown may be included.

Accuracy and completeness of risk factors is an area of enforcement focus for the SEC. In addition to identifying material risks for disclosure, companies are encouraged to consider whether any previously identified risks have actually materialized. In such a case, risk factor updates may be needed. Additionally, disclosure of any materialized risk in the “MD&A” section as a known trend, event, or uncertainty may be warranted. Finally, if a company’s risk factor disclosure is longer than 15 pages, the company must include a summary of principal risk factors.

MD&A

The “MD&A” section remains a primary area of focus for the SEC. It requires the accurate presentation and discussion of the company’s financial performance and known trends, events, and uncertainties that may affect its financial condition and results of operations, as required by Item 303 of Regulation S-K. “MD&A” also requires a discussion of capital resources and liquidity, results of operations, and critical accounting estimates.

Preparers are encouraged to consult SEC guidance when drafting their MD&A, including Release Nos. 33-6835, 33-8056, 33-8350, and 33-9144, which provide information on the SEC’s expectations for MD&A disclosure. According to a report from Deloitte, which examined comment letters issued by the SEC in connection with the filing reviews of Forms 10-K and 10-Q for 12 months ending July 31, 2025, half of all reviews with comment letters included a comment on MD&A.

Exhibits and exhibit index

Item 15 of Form 10-K requires a company to provide an exhibit index listing the documents filed with (or incorporated by reference into) Form 10-K in compliance with Item 601 of Regulation S-K. As a general housekeeping matter, companies are encouraged to review the exhibit index each year and remove any exhibits that are no longer required. Examples of such documents include:

• Agreements related to debt securities or financings that have matured or are no longer outstanding
  
  
• Material contracts that have expired or been terminated or completed
  
  
• Employment or incentive award agreements with executives who have left the company

Companies may also consider whether there have been any recent changes in their organizational or capital structures that would necessitate updating the list of subsidiaries or the description of outstanding securities required by Items 601(b)(21) and 601(b)(4)(vi), respectively.

eXtensible Business Reporting Language (XBRL)

Companies are encouraged to be mindful of the XBRL format tagging requirement for the cover page and disclosures regarding clawbacks, cybersecurity, Rule 10b5-1 trading plans, insider trading policies and procedures, and equity grant policies, as well as the financial statements and related schedules.

In September 2023, the SEC issued a sample letter to companies regarding their XBRL and Inline XBRL disclosures that noted inconsistent or erroneous tagging in SEC filings, including periodic reports. Companies may want to consider reviewing their XBRL disclosure for consistency throughout Form 10-K and compliance with the SEC’s rules and guidance.

Additional disclosure considerations

Financial reporting issues

Companies should continue to be mindful of certain financial reporting issues that the SEC has focused on, such as:

• Compliance with non-GAAP rules and regulation
• Critical accounting estimates disclosure in MD&As
• Segment reporting

Non-GAAP disclosure

According to a Deloitte analysis of the top ten topics on which the SEC had issued comment letters during the 12-month period ending July 31, 2025, non-GAAP measures was the second most prevalent topic behind MD&A comments, with 37 percent of all SEC reviews of periodic reports including a comment letter having at least one comment related to non-GAAP measures.

SEC staff comments pertaining to non-GAAP disclosures may be related to the following issues:

• Prominence of non-GAAP measures
• Whether certain adjustments are potentially misleading
• Enhanced disclosure regarding the purpose and use of non-GAAP measures
• Identification and clear labeling of non-GAAP measures
• Characterization of non-GAAP measures as liquidity or performance measures
• Reconciliation requirements
• Presentation of the income tax effect of non-GAAP adjustments
• Disclosures related to certain financial and operating metrics

In light of the SEC’s continued focus on compliance with non-GAAP rules and related SEC guidance, companies are encouraged to:

• Develop or review the effectiveness of their non-GAAP policies, disclosures controls, and procedures
  
  
• Pay careful attention to any adjustments, including identifying all necessary adjustments and consider whether they qualify as non-recurring
  
  
• Confirm any adjustments are consistently measured from period to period
  
  
• Evaluate adjustments to confirm they are compliant with SEC rules and guidance

Critical accounting estimates

The SEC provided guidance in Release No. 33-8350 surrounding its expectations for the disclosure of accounting estimates in MD&A. According to the release:

While accounting policy notes in the financial statements generally describe the method used to apply an accounting principle, the discussion in MD&A should present a company's analysis of the uncertainties involved in applying a principle at a given time or the variability that is reasonably likely to result from its application over time.

In comment letters, SEC staff often directs companies to address how uncertainty related to such estimates may impact their consolidated financial statements. In some cases, the SEC asked companies to explain how estimates and/or assumptions changed over time.

Therefore, it may be prudent for companies to ensure that disclosure related to critical accounting estimates and assumptions does not simply repeat the significant accounting policy disclosure, but instead supplements that disclosure by including quantitative and qualitative information related to the estimation uncertainty. Companies are also encouraged to address why their accounting estimates and assumptions may change over time. Other issues that they may discuss include:

• How they arrived at the estimates or assumptions
• The past accuracy of the estimates or assumptions
• How significantly the estimates or assumptions have changed in the past
• The likelihood for future change

Segment reporting

Accounting Standards Update 2023-07 (ASU 2023-07) – which was adopted by the Financial Accounting Standards Board (FASB) in November 2023 and first became applicable to companies for their Forms 10-K for fiscal years beginning after December 15, 2023 – requires companies to disclose significant segment expenses and other segment disclosure items.

Importantly, ASU 2023-07 requires companies with only one reportable segment to provide all of the disclosures required by ASU 2023-07 and Accounting Standards Codification 280, Segment Reporting (ASC 280), whereas historically, ASC 280 allowed single reporting segment entities to disclose only some entity-wide information.

Under ASU 2023-07, companies must disclose for each reportable segment the significant segment expenses that are regularly provided to the Chief Operating Decision Maker (CODM) and included in the reported measure of a segment’s profit or loss. A company is required to identify the segment expenses that are regularly provided to the CODM or are “easily computable” from the information regularly provided to the CODM. If the expenses are determined to be “significant,” they must be disclosed as a significant segment expense. Significance is determined considering both qualitative and quantitative factors. Significant expenses may vary across individual reportable segments, and different measures of segment profit or loss can be used for different reportable segments if the CODM uses those measures to assess performance and allocate resources to segments. If segment expense is determined to be significant, the expense category and amount is required to be disclosed.

In addition to significant segment expenses, companies are required to disclose, for each reportable segment, the difference between reported segment revenue, less significant segment expenses disclosed, and the reported measure of a segment’s profit or loss. A qualitative disclosure describing the composition of the other segments items, such as the nature or type, is also required, although a quantification of each item is not required.

Companies are encouraged to determine how the adoption of ASU 2023-07 may impact their segment disclosures in other sections of their Forms 10-K, aside from their financial statements, such as the “Business” or “MD&A” sections.

Climate disclosure

As discussed in a DLA Piper client alert, on April 4, 2024, the SEC issued an order voluntarily staying the climate-related disclosure rules (Climate Rules), which had been adopted on March 6, 2024.

In April 2025, the US Court of Appeals for the Eighth Circuit, which had jurisdiction over the consolidated challenges to the Climate Rules, paused the case after a motion to hold it in abeyance was brought by a group of 18 intervening states and Washington, DC following the SEC’s decision in March 2025 to withdraw its defense of the rules.

In July 2025, the SEC informed the court that it did not intend to revisit the rules and urged the court to proceed with the case. As discussed in further detail in DLA Piper’s Market Edge blog post, in September 2025, the court ordered the case to remain paused until the SEC takes further action (i.e., makes a decision to formally rescind, modify, or defend the Climate Rules).

While the SEC may be unlikely to change its position and defend the Climate Rules in court, it is unclear if and when the SEC will take formal action to rescind or amend the rules.

Despite uncertainty, companies remain subject to other rules and SEC guidance regarding the disclosure of material risks, including climate-related risks. Failure to provide information – or the delivery of misleading statements regarding climate-related risks or opportunities – could expose companies to liability under federal securities laws.

As the SEC noted in its 2010 guidance, companies may be required to disclose material climate-related information regarding the impact of state and foreign regulations, business trends, and the physical effects of climate change in various sections of their Forms 10-K, including the “Business,” “Legal Proceedings,” “Risk Factors,” and “MD&A” sections.

Stakeholders, such as investors, employees, and customers, including those in foreign jurisdictions that are subject to mandatory climate reporting, may also expect companies to publicly disclose climate-related data, such as greenhouse gas emissions and risks posed by climate change.

Some institutional investors continue to support environmental, social, and governance (ESG) initiatives and may continue to urge companies to voluntarily provide disclosure regarding the potential impact of climate-related matters on their operations, financial performance, and strategy. Failure to provide this information, even if not mandated by the SEC, could prompt activist shareholders to submit proposals seeking additional disclosures or climate-related actions. Further, directors at companies that fail to address their climate-related risks may be subject to “no” or “withhold” votes in connection with their elections or may be subject to proxy fights, which could receive the backing of institutional investors.

However, the Trump Administration continues to signal opposition to ESG initiatives, including through an EO issued on December 11, 2025 that aims to curb the influence of proxy advisory firms that advise institutional investors on DEI and ESG-related matters, as described in our blog. The EO, titled, “Protecting American Investors from Foreign-Owned and Politically-Motivated Proxy Advisors,” directs the SEC Chairman to review, rescind, or revise all rules and regulations related to proxy advisory firms that implicate DEI and ESG priorities, as well as rules related to shareholder proxy proposals. While the EO primarily focuses on proxy advisory firms, it could impact the views and voting policies of large institutional investors on climate-related and other ESG matters.

Other legal developments could also impact a company’s decision to voluntarily disclose climate-related information. For example, on November 18, 2025, the US Court of Appeals for the Ninth Circuit issued an injunction staying enforcement of California’s SB 261, the Climate-Related Financial Risk Act, pending the outcome of Chamber of Commerce of the United States of America et al. v. California Air Resources Board.

SB 261 requires companies doing business in California and generating more than $500 million annually in revenue to publicly disclose information regarding their climate-related financial risks. As a result, covered entities are not required to submit their SB 261 reports on January 1, 2026, as originally scheduled, while the injunction is in place. Companies that had been planning on voluntarily disclosing the information required in their SB 261 reports in their Forms 10-K in 2026 may refrain from doing so in response to these developments.

Any voluntary disclosures that are made in a company’s SEC filings, including its Form 10-K, would be subject to anti-fraud and other liability provisions under securities laws. Even if the SEC is not actively pursuing climate- or ESG-related claims, enforcement actions could still be brought for false or misleading disclosures in Forms 10-K. Shareholders may also bring securities and other fraud claims for a company’s material climate-related statements.

Despite the failure to implement the Climate Rules, many companies still provide climate-related disclosures in their Forms 10-K. For example, the Center for Audit Quality (CAQ) analyzed the most recent Forms 10-K for S&P 500 companies as of June 30, 2025. The CAQ Survey revealed most of those companies (494) included climate-related information in their Forms 10-K, typically in their “Business” or “Risk Factors” sections.

AI

AI has significantly impacted many industries and has garnered attention from investors, other stakeholders, and regulators, including the SEC. At a meeting on December 4, 2025, the SEC’s Investor Advisor Committee recommended that the SEC adopt a standard set of disclosures regarding AI, including requiring companies to adopt a definition for “artificial intelligence,” disclose board oversight for the deployment of AI, and report on how they are deploying AI and its effects on internal business operations and consumers.

In his remarks at the meeting, Chairman Atkins voiced skepticism regarding the adoption of prescriptive SEC disclosure rules related to AI, stating, “I believe that investors can rely on our current principles-based rules to inform them of how AI impacts companies.” He also said that SEC rules, which rely on the fundamental principle of materiality, already allow companies to disclose material impacts from AI, including its effect on financial results and risk factors.

Although Form 10-K does not prescribe specific disclosure regarding a company’s use of or involvement with AI, companies are encouraged to consider whether AI has impacted or could potentially impact their business in a material way that would warrant disclosure under the SEC’s existing rules, such as in the “Business” or “Risk Factors” sections of their Forms 10-K.

To the extent that a company determines that AI is material to its business, it is encouraged to ensure that its AI-related disclosures are complete and accurate. When crafting AI disclosure, companies may consider:

• Providing a clear representation of their AI capabilities, including substantiated details regarding how AI is or is being integrated into their operations or products
  
  
• Disclosing operational, ethical, and cybersecurity risks in the “Business,” “Risk Factors,” and “MD&A” sections, as appropriate, detailing how they are identified, assessed, and managed
  
  
• Disclosing the financial impact of material AI initiatives, including any revenue generated, cost savings achieved, or investments made in AI technologies
  
  
• Discussing the ethical considerations and governance frameworks surrounding a company’s use of AI, including policies on data privacy, bias mitigation, and the ethical use of AI technologies and the oversight mechanisms that a company has in place to ensure responsible AI usage, including the board’s role in providing oversight

Digital assets

There was a significant rise of digital asset treasury (DAT) public companies in 2025, which introduced a new set of risks and challenges. Companies embracing DAT as their core business strategy are encouraged to review the SEC staff’s statements and observations when drafting the relevant sections of Form 10-K to ensure that material aspects of the companies’ business and risks are captured. This includes third-party risks arising from crypto assets that are managed by third-party asset managers. Companies that hold digital assets in the normal course of their business – whether or not they have adopted DAT as their main business strategy – are encouraged to consider risks that may be associated with certain digital assets, including volatility, regulatory uncertainty, cybersecurity, and lack of liquidity.

The SEC, along with the Trump Administration, has pursued a broad initiative to promote the development of blockchain innovation and digital asset technologies. These initiatives include President Donald Trump’s January EO, titled, “Strengthening American Leadership in Digital Financial Technology;” the SEC’s establishment of a Crypto Task Force; a comprehensive report on digital assets published by the President’s Working Group on Digital Asset Markets; and SEC Chairman Atkins’s announcement of Project Crypto on July 31, 2025. Project Crypto outlines the SEC’s strategic initiative to modernize current US securities laws and establish a regulatory framework to foster capital formation in the digital assets markets.

As discussed previously in a Market Edge blog post, the staff of the SEC’s Division of Corporation Finance issued a statement in April 2025 containing its observations regarding certain SEC disclosure requirements in the offering and registration of certain digital assets. While this statement addressed disclosures for transactions involving digital assets that are considered securities, the staff made certain statements regarding disclosures made in the “Business” and “Risk Factors” sections of prospectuses that would similarly extend to the disclosures in these sections of a company’s Form 10-K.

In particular, the staff reiterated that “Business” section disclosure should be “tailored to the company’s business and presented in clear, concise, and understandable language, without overly relying on technical terminology or jargon.” The statement details the types of “Business” section disclosures that have been made by registrants, including planned business activities following the launch of a network or application, plans for revenue generation, relevant developmental milestones, the digital assets’ role in the functioning of the business, and the purpose and operations of networks or applications that the registrant planned to acquire.

For the “Risk Factors” section, the staff noted that disclosure may include information that addresses the development and implementation of the registrant’s business and the characteristics of the digital asset, such as “its features, price volatility, limited rights of holders, valuation and liquidity risks, technological risks, cybersecurity risks, business, operational, and network risks, and legal and regulatory risks.”

As also noted in the Market Edge blog, the SEC’s September 4, 2025 Spring 2025 Unified Agenda of Regulatory and Deregulatory Actions (Reg Flex Agenda) – which sets forth its rulemaking priorities for the next several months – included recommendations for several proposed rules related to crypto assets. While these proposals addressed areas such as their offer and sale (including exemptions and safe harbors), custody, use of distributed ledger technology by transfer agents, broker-dealer responsibilities and record-keeping, and trading on alternative trading systems and national securities exchanges – proposed rules intending to clarify the regulatory framework for digital assets could result in new disclosure requirements for Form 10-K for DATs or other companies employing digital assets as a regular part of their business. The proposed rules are expected to be introduced by April 2026.

Companies should also be cognizant of the SEC’s guidance regarding the accounting for digital assets. In January 2025, the SEC adopted Staff Accounting Bulletin No. 122 (SAB 122), which rescinded prior Staff Accounting Bulletin 121 (SAB 121). SAB 122 provides that, if an entity has an obligation to safeguard crypto assets for others, it should determine whether to recognize a liability related to the risk of loss under such an obligation. If so, the entity should determine the measurement of such liability by applying the recognition and measurement requirements for liabilities arising from contingencies in Financial Accounting Standards Board Accounting Standards Codification Subtopic 450-20, Loss Contingencies, or International Accounting Standard 37, Provisions, Contingent Liabilities and Contingent Assets, under US generally accepted accounting principles and IFRS Accounting Standards, respectively.

SAB 122 provides that entities should effect the rescission of SAB 121 on a fully retrospective basis in annual periods beginning after December 15, 2024. Entities may elect to effect the rescission in any earlier interim or annual financial statement period included in SEC filings after the effective date of SAB 122.

These financial reporting requirements will require companies to establish robust internal controls, accounting, and disclosure standards. Companies are encouraged to engage with internal auditors that are knowledgeable of accounting issues related to digital assets and can assess internal controls related to digital assets. In turn, external auditors will expect companies to establish strong internal controls and appropriate governance structures for a company’s digital assets.

Issues that may arise in connection with an external audit could include evidencing wallet addresses, assessing the internal controls of third parties, identifying related party transactions, determining critical audit matters, and accounting for third-party custody arrangements, which issues may require additional time for external auditors to assess.

Transparent and robust disclosures of digital asset holdings, valuations, and impairment methodologies may help companies comply with SAB 122 and reassure auditors, investors, and analysts regarding the reliability of a company’s financial reporting with respect to digital assets. Early engagement with external auditors could help avoid potential delays in preparing Form 10-K for filing with the SEC.

Cybersecurity disclosure

The SEC’s cybersecurity disclosure rules, as discussed in a DLA Piper client alert, require annual disclosure of cybersecurity risk management, strategy, and governance in Part 1, Item 1C of Form 10-K. Calendar year-end companies first started complying with these disclosure requirements in their Form 10-K for the year ended December 31, 2023. Companies are also encouraged to consider other sections of Form 10-K for which the disclosure of cybersecurity-related information may be important, including the “MD&A” and “Business” sections.

Cybersecurity disclosure and governance have been areas of focus for the SEC in the last several years. However, as described in the Market Edge blog, the change of administration at the SEC in 2025 has intensified efforts to rescind the cybersecurity disclosure rules.

Notably, at the time of adoption, the two Republican-appointed commissioners, Hester Peirce and Mark Uyeda, voiced their opposition to the cybersecurity rules. In March 2025, the Republican members of the House Financial Services Committee issued a letter to then-Acting Chairman Mark Uyeda, urging the SEC to withdraw the cybersecurity rules. That same month, at a hearing of the US House Committee on Homeland Security Subcommittee on Cybersecurity and Infrastructure, several lawmakers expressed dissatisfaction with the cybersecurity rules, citing their ambiguity and restrictive reporting timelines. Given this opposition to the rules, the SEC could potentially look to scale back some of the cybersecurity requirements.

Other annual reporting and compliance issues

Form SD

Pursuant to Rule 13p-1 under the Exchange Act (Conflict Minerals Rule), companies that manufacture or contract to manufacture products containing conflict minerals may be subject to reporting under Section 1 of Form SD. Companies subject to the Conflict Minerals Rule are required to file Form SD, Section 1 no later than May 31 after their most recent calendar year. In 2026, the Form SD is due no later than June 1, as May 31 falls on a Sunday.

Pursuant to Rule 13q-1 under the Exchange Act, public companies that engage in the commercial development of oil, natural gas, or minerals or the acquisition of a license for such activities must furnish an annual report on Form SD, Section 2 with the SEC. The report must disclose in an exhibit payments made to the US federal government or foreign governments for the commercial development of oil, natural gas, or minerals in its last fiscal year.

In recent years, some smelters, which must be reported on Form SD filings, have been designated by the US Department of the Treasury’s Office of Foreign Assets Control (OFAC) as “Specifically Designated Nationals” (SDNs) and are subject to economic and trade sanctions. Companies are urged to conduct diligence on the entities included in their Form SD filings and determine whether they appear on the SDN List and any separate disclosures to OFAC may be merited. The Form SD, Section 2 must be filed 270 days after a company’s most recently completed fiscal year (September 28, 2026 for calendar year-end companies).

Priorities of the SEC under Atkins administration

Since the beginning of 2025, the SEC has indicated a shift in priorities from the prior administration under Chairman Gary Gensler. Shortly after his appointment, in an SEC Town Hall speech in May 2025, Chairman Atkins announced “it is a new day here at the SEC” in outlining the SEC’s priorities under his administration, including enacting regulations related to digital assets, promoting capital formation, and improving the usefulness of disclosures. Toward that end, the SEC announced several initiatives in 2025 that may impact the disclosure requirements for and practices of public companies, including what they may be required to report on Form 10-K.

The Reg Flex Agenda includes certain items that are intended to reduce the disclosure burden for public companies, including proposed rules to expand the accommodations for EGCs, simplify filer status, and “rationalize disclosure practices to facilitate material disclosure by companies and shareholders’ access to that information.”

While the Reg Flex Agenda does not indicate which Form 10-K disclosures could potentially change, proposed changes will likely involve some of the current Form 10-K disclosure requirements. Changes to the rules related to filer status could also give more public companies additional time to prepare Form 10-K or opportunities to provide scaled disclosures.

In September 2025, at the request of President Trump, Chairman Atkins said that the SEC would fast-track proposed rules to allow for semiannual instead of quarterly reporting with the SEC. In addition, in a speech at the 2025 Institute for Corporate Counsel on December 3, 2025, SEC Commissioner Uyeda questioned the appropriateness of blanket quarterly reporting on Form 10-Q for all public companies and commented that shifting to semiannual reporting would provide flexibility for companies to “align the reporting period with the potential needs of their shareholder base, business cycle, and securities analyst coverage.” He also noted that other jurisdictions had semiannual reporting and that the United Kingdom, which moved from quarterly to semiannual reporting, did not see a significant decrease in investment activities in UK companies following such transition. It is not clear how semiannual reporting would impact Form 10-K or the timing for any such SEC proposal for semiannual reporting.

Conclusion

Depending on the size of their organizations and the working groups tasked with drafting Form 10-K and preparing other annual disclosures, companies are encouraged to prepare early to ensure compliance with SEC rules and the timely filing of Form 10-K and other required disclosures. An early start to this process may also facilitate important discussions with the company’s auditor, which may help ensure timely resolution of potential issues without compromising the company’s filing deadline.

In light of the shift in priorities noted above, it is possible that there will be significant changes to Form 10-K disclosure requirements for the 2027 reporting season. It is not too early for companies to plan for changes in the SEC’s disclosure regime. Assuming the SEC stays true to its stated goals of facilitating capital formation and rationalizing disclosure requirements for public companies, the burdens of annual reporting may be lessened by this time next year, which would be a welcome change for many public companies.

For more information, please contact the authors.

 

 

Appendix A

Top 20 Form 10-K risk factors reported by Russell 3000 companies between June 30 and November 25, 2025

 

 

2025 ranking	Risk factor description	Percentage of 2025 Forms 10-K including risk factor (out of 217)	Percentage of 2024 Forms 10-K including risk factor (out of 244)	Year-over-year change in ranking
1	Cybersecurity, data privacy, and information technology	99.5	98.8	None
2	Operational disruptions	99.1	97.1	None
3	Dependence on employees, management, and key personnel	96.3	95.1	None
4	Failure to compete effectively	94.5	94.7	None
5	New/changes in law and regulation	89.4	86.1	None
6	Failure to identify, integrate, or realize anticipated benefits of acquisitions	83.9	84	1 ↑
6	Natural disasters, climate change, and extreme weather	83.9	81.6	4 ↑
8	Dependence on third-party vendors/distributors/manufacturers	82.5	84	1 ↓
9	Potential/current litigation/claims	81.6	79.5	2 ↑
10	Subject to law and regulation	80.2	81.6	1 ↓
11	General economic conditions/downturn	78.8	84.4	5 ↓
12	International political/economic/operational risks	75.6	75.4	None
13	Threat/costs of intellectual property infringement claims	75.1	75.4	1 ↓
14	AI	71.9	59	8 ↑
15	Changes in tax rate, tax law, or tax treatment	71	66	1 ↑
16	International trade restrictions and protectionism	70.1	55.7	9 ↑
17	Product quality/defects/recalls/liability	69.1	68	2 ↓
18	Foreign law and regulation	68.2	65.2	1 ↓
19	Increases in price/shortages of raw materials/inputs	62.2	60.7	None
20	Debt restrictions and covenants	60.8	60.3	None

 

Disclaimer:

 

DLA Piper Corporate Data Analytics relies on tools such as search engines, algorithms, and other processes to analyze data and may utilize data provided by third parties. Data by its nature is collected and analyzed using judgments, assumptions, and other limitations. The data analyzed may be inaccurate or incomplete, and data analysis tools and algorithms may fail to perform as expected, resulting in inaccuracies. DLA Piper expressly disclaims the accuracy, adequacy, or completeness of any data and shall not be liable for any errors, omissions, or other defects in such data, or for any actions taken in reliance thereon.