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I am not sure if I am using the right terminology, but when NYSE issues a listed company a non-compliance letter, they get listed in their "Noncompliant Issuers".

For example, the first company listed, Adcare Health Systems ($ADK), has three deficiencies:

  • 1003(a)(i) - Equity below $2 million and years of losses
  • 1003(a)(ii) - Equity below $4 million and years of losses
  • 1003(a)(iii) - Equity below $6 million and years of losses

I went to read Sec. 1003. APPLICATION OF POLICIES, and see that

(a) Financial Condition and/or Operating Results—The Exchange will normally consider suspending dealings in, or removing from the list, securities of an issuer which:

(i) has stockholders' equity of less than $2,000,000 if such issuer has sustained losses from continuing operations and/or net losses in two of its three most recent fiscal years; or

(ii) has stockholders' equity of less than $4,000,000 if such issuer has sustained losses from continuing operations and/or net losses in three of its four most recent fiscal years; or

(iii) has stockholders' equity of less than $6,000,000 if such issuer has sustained losses from continuing operations and/or net losses in its five most recent fiscal years; or

Question is, how can I see if the company is within the required regulations? That is, how do I find, calculate, or understand the financial data to discover whether a company has equity above a certain number? (I am using ADK only as an example).

And as a followup question, let's say that the company becomes compliant, how long does it take NYSE to send a compliance letter? Does it happen only after accepting a proposed "return to compliance" plan submitted by the company?

  • Stockholders' equity (in general owner's equity) -- and operating losses also -- are basic items in all financial statements since accounting was invented. For listed US companies they are included in required annual audited and quarterly unaudited statements filed with the SEC as forms 10-K and 10-Q respectively and available in sec.gov/edgar . Companies also post these on their own website in an 'investor relations' section, although finding that section is sometimes not easy. Usually that also has more convenient press releases etc. although sometimes not for bad news. – dave_thompson_085 Aug 18 '17 at 20:05
  • Is that the "Total assets" line in their Quarterly Report? – KingsInnerSoul Aug 18 '17 at 20:18
  • No, assets and equity are separate and partly opposite concepts. See en.wikipedia.org/wiki/Balance_sheet and particularly the link to en.wikipedia.org/wiki/Accounting_equation where equity = assets minus liabilities, or equivalently assets = liabilities plus equity. – dave_thompson_085 Aug 19 '17 at 19:36

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