Definition - What does Deficiency Letter mean?
Deficiency Letter is a letter sent to a corporate issuer by the SEC, requesting additional information regarding the issuer’s registration statement.
Testopedia explains Deficiency Letter
When an issuer wants to sell non exempt securities to the public they will file a registration statement with the SEC. The registration statement formally known as an S1, is the full disclosure document provided to the SEC. If the SEC wants more information or clarification regarding the information, the SEC will issue a deficiency letter. Once the issuer receives the deficiency letter the issuer must respond to the request for information. The receipt of the deficiency letter will extend the cooling off period for the securities.