UPDATE: As of May 9, we found a total of 15 companies that had filed either a Form SD alone, or a Form SD with a CMR.
Several companies have already filed their Form SD/Conflict Minerals Reports with the Securities and Exchange Commission – weeks before the regulatory deadline of June 1, 2015. There may be more, but we found seven new filings (not counting Apple, who filed two months ago) and read them all. Our thoughts are below. We note that none of these filers are clients of ours.
One company filed a Form SD only, which contained a detailed description of the filer’s Reasonable Country of Origin Inquiry (RCOI) process and how their conclusion was reached. This seems to be in line with comments made by SEC CorpFin Director Keith Higgins about the CY2013 filings lack of information provided by Form SD-only filers.
One Conflict Minerals Report (CMR) is very brief and in our view, does not adequately address the reporting requirements. It seems similar to the very first CMR filed last year, which received much unwanted attention due to its brevity and incompleteness and was ultimately amended.
The remainder of the CMRs include RCOI activities within descriptions of the due diligence framework and activities undertaken. If these CMRs were subject to the Independent Private Sector Audit (IPSA) as they are, the audit costs would be on the upper end.
Also, some of the CMRs list the smelter/refiner location country as if it is the country of origin. It is important to remember that 3TG ores and intermediates are transported all over the globe, so the location of the processing facility is not always determinative of where the ores come from.