CPA Excel - US Securities and Exchange Commission Flashcards
Describe the components of SEC’s organizational structure.
SEC is a member of the International Organization of Securities Commissions. Has 5 Commissioners appointed by US Presidents.
Four divisions (the commission)
1) Corporate Finance
2) Enforcement
3) Trading and markets
4) Investment management
What is the SEC’s role in the standard-setting process?
Although the SEC can prescribe accounting standards, it has delegated that task to the private sector (currently the FASB). However, the SEC maintains the enforcement power for all publicly traded companies to assure compliance with U.S. GAAP.
What are the main pronouncements issued by the SEC?
Financial Reporting Releases (FRR) - formal pronouncements and are the highest-ranking authoritative source of accounting for public companies.
Staff Accounting Bulletins (SAB) – These provide the SEC’s current position on technical issues.
What is the mission of the SEC?
“The mission of the U.S. Securities and Exchange Commission is to protect investors, maintain fair, orderly and efficient markets, and facilitate capital information”
SEC enforces compliance with US GAAP for publically traded companies.
What are the main reporting requirements for the 1933 Securities Act?
1933 Act - Applies to registration of IPOs of securities.
Form S-1: Basic registration form for new securities, requires prospectus, info about company, business operations, risks, financial stmts and use of proceeds
Financial statments for IPOs - audited financial statements - 2 years of balance sheets, 3 years of I/S, stmts of C/F, and S/H Equity - must be presented.
What are the main reporting requirements for the 1934 Securities Act?
1934 Act - Applies to reporting information about securities already issued.
Regulation S-X provides detailed guidance on reporting requirements
- Annual Filing - Form 10-K
- Quarterly Filing - Form 10-Q
- Report significant events on Form 8-K
