Form 20-F

Form 20-F is the annual report that a foreign private issuer, a non-US company that meets the SEC's definition, files with the SEC. It plays the same role as a US company's Form 10-K, and it is due within four months after the end of the fiscal year.

How it works

A 20-F covers the business, risk factors, operating and financial review (the foreign equivalent of MD&A), directors and compensation, major shareholders, related-party transactions, and audited financial statements. Financials can be prepared under US GAAP, under IFRS as issued by the IASB without reconciliation, or under home-country standards with a reconciliation to US GAAP.

Foreign private issuers are not required to file quarterly reports on Form 10-Q. Instead, they furnish material information on Form 6-K as they publish it at home. They are also exempt from the US proxy rules and from Regulation FD. Some foreign companies choose to file 10-Ks and 10-Qs voluntarily, and eligible Canadian issuers can use Form 40-F under the multijurisdictional disclosure system.

Why it matters for traders

Many widely traded ADRs, including large Chinese, Israeli and European companies, report through 20-Fs. The longer deadline means the full annual report can arrive months after earnings were announced. Read the sections that do not appear in press releases: the variable interest entity (VIE) structure and related regulatory risks for many China-based companies, auditor inspection issues, dual-class voting control, and the major shareholders table. Because these companies do not file quarterly 10-Qs, the 20-F is often the only fully audited, detailed look at the business each year.

Example

A hypothetical Israel-based cybersecurity company, Cedar Shield (CDSH), has a December 31 fiscal year-end. It announces full-year results by press release, furnished on a 6-K, on February 12, and files its 20-F on March 28, well within the April 30 deadline. The 20-F discloses that its top three customers account for 41% of revenue.

FAQ

What is a foreign private issuer?

A non-US company that does not have more than 50% of its voting securities held by US residents, or, if it does, does not meet other tests such as a majority of US executives or assets.

Do 20-F filers report quarterly?

They are not required to file 10-Qs. Many furnish quarterly results on Form 6-K because their home market or exchange requires it.