SEC Comment Letter for ProShares Trust II (AGQ, EUO, GLL, SCO, UCO, UGL, ULE, YCL, YCS, ZSL, BOIL, KOLD, SVXY, UVXY, VIXM, VIXY) (CIK 0001415311) (AGQ) — Jun 25, 2013
ProShares Trust II (AGQ, EUO, GLL, SCO, UCO, UGL, ULE, YCL, YCS, ZSL, BOIL, KOLD, SVXY, UVXY, VIXM, VIXY) (CIK 0001415311)
Date: June 25, 2013 · CIK: 0001415311 · Accession: 0000000000-13-034534
AI Filing Summary & Sentiment
Letter
June 25, 2013 Via E -mail Edward Karpowicz Principal Financial Officer ProShares Trust II c/o ProShare Capital Management LLC 7501 Wisconsin Avenue Suite 1000 Bethesda, MD 20814
Re: ProShares Trust II Form 10-K Filed March 1 , 201 3 File No. 001 -34200
Dear M r. Karpowicz :
We have reviewed your filing an d have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure.
Please respond to this letter within ten business days by amending your filing, by providing the requested information, or by advising us when you will provide the requested response. If you do not believe our comments apply to your fact s and circumstances or do not believe an amendment is appropriate, please tell us why in your response.
After reviewing any amendment to your filing and the information you provide in response to these comments, we may have additional comments.
Form 10 -K for the year ended December 31, 2012
Financial Statements
Report of Independent Registered Public Accounting Firm, page F -2
1. Please tell us how you r auditors determined it was not necessary to reference the Schedules of Investments in their audit opinion.
2. It appears that ProShares Ultra VIX Short -Term Futures should have a (b) and Proshares VIX Short -Term Futures should hav e an (e) in the audit opini on. Please have your auditors revise their audit opinion.
Edward Karpowicz ProShares Trust II June 25, 2013 Page 2
Financial Statements of ProShares Trust II, page F -130
Combined Statements o f Financial Condition, page F -130
3. We note that you recorded a receivable from capital shares sold as an asset for cert ain Funds and for the Trust. Please tell us how you determined it was appropriate to record this item as an asset, or tell us how you determined it was not necessary to disclose the payment date in the financial statement footnotes, if payment was receive d prior to issuing the financial statements. Please refer to paragraph 2 of ASC 505 -10-45.
Notes to Financial Statements, page F -134
Note 5 – Organization and Offering Costs, page F -151
4. Please tell us how you complied with SAB Topic 5A, or tell us how you determined it was appropriate to record offering costs of certain Funds as an expense for certain Funds and for the Trust.
Exhibit 23.1
5. Please have your auditors revise their consen t to clarify that their consent also relates to the financial statements of the Funds.
We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filing to be certain that the filing includes the information the Secur ities Exchange Act of 1934 and all applicable Exchange Act rules require. Since the company and its management are in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy and adequacy of the disclosures they ha ve made.
In responding to our comments, please provide a written statement from the company acknowledging that:
the company is responsible for the adequacy and accuracy of the disclosure in the filing;
staff comments or changes to disclosure in respo nse to staff comments do not foreclose the Commission from taking any action with respect to the filing; and
the company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities la ws of the United States.
Edward Karpowicz ProShares Trust II June 25, 2013 Page 3
You may contact Jennifer Monick, Senior Staff Accountant , at 202-551-3295 or me at 202-551-3629 if you have questions.
Sincerely,
/s/ Kevin Woody
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June 25, 2013 Via E -mail Edward Karpowicz Principal Financial Officer ProShares Trust II c/o ProShare Capital Management LLC 7501 Wisconsin Avenue Suite 1000 Bethesda, MD 20814 Re: ProShares Trust II Form 10-K Filed March 1 , 201 3 File No. 001 -34200 Dear M r. Karpowicz : We have reviewed your filing an d have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. Please respond to this letter within ten business days by amending your filing, by providing the requested information, or by advising us when you will provide the requested response. If you do not believe our comments apply to your fact s and circumstances or do not believe an amendment is appropriate, please tell us why in your response. After reviewing any amendment to your filing and the information you provide in response to these comments, we may have additional comments. Form 10 -K for the year ended December 31, 2012 Financial Statements Report of Independent Registered Public Accounting Firm, page F -2 1. Please tell us how you r auditors determined it was not necessary to reference the Schedules of Investments in their audit opinion. 2. It appears that ProShares Ultra VIX Short -Term Futures should have a (b) and Proshares VIX Short -Term Futures should hav e an (e) in the audit opini on. Please have your auditors revise their audit opinion. Edward Karpowicz ProShares Trust II June 25, 2013 Page 2 Financial Statements of ProShares Trust II, page F -130 Combined Statements o f Financial Condition, page F -130 3. We note that you recorded a receivable from capital shares sold as an asset for cert ain Funds and for the Trust. Please tell us how you determined it was appropriate to record this item as an asset, or tell us how you determined it was not necessary to disclose the payment date in the financial statement footnotes, if payment was receive d prior to issuing the financial statements. Please refer to paragraph 2 of ASC 505 -10-45. Notes to Financial Statements, page F -134 Note 5 – Organization and Offering Costs, page F -151 4. Please tell us how you complied with SAB Topic 5A, or tell us how you determined it was appropriate to record offering costs of certain Funds as an expense for certain Funds and for the Trust. Exhibit 23.1 5. Please have your auditors revise their consen t to clarify that their consent also relates to the financial statements of the Funds. We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filing to be certain that the filing includes the information the Secur ities Exchange Act of 1934 and all applicable Exchange Act rules require. Since the company and its management are in possession of all facts relating to a company’s disclosure, they are responsible for the accuracy and adequacy of the disclosures they ha ve made. In responding to our comments, please provide a written statement from the company acknowledging that: the company is responsible for the adequacy and accuracy of the disclosure in the filing; staff comments or changes to disclosure in respo nse to staff comments do not foreclose the Commission from taking any action with respect to the filing; and the company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities la ws of the United States. Edward Karpowicz ProShares Trust II June 25, 2013 Page 3 You may contact Jennifer Monick, Senior Staff Accountant , at 202-551-3295 or me at 202-551-3629 if you have questions. Sincerely, /s/ Kevin Woody Kevin Woody Branch Chief