SEC Flashcards
Since 2008, the SEC has permitted foreign private issuers to file their financial statements using
IFRS as issued by the IASB.
The main pronouncements published by the SEC are
Main pronouncements of the SEC are Financial Reporting Releases (FRR) and Staff Accounting Bulletin (SAB).
The mission of the SEC is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation. In order to carry out the mandates of the Securities Act of 1933, the SEC ensures…
To carry out its mission the SEC ensures that investors are provided with adequate information on which to base investment decisions.
What are the five divisions of the SEC?
Division of Corporate Finance - Oversees compliance with the securities acts and examines all filings made by publicly held companies. All filings go to this division.
Division of Enforcement - When there is a violation of a securities law, this division completes the investigation and takes appropriate actions. This division makes recommendations to the Justice Department concerning any potential punishments pr criminal prosecution.
Division of Trading and Markets: This division oversees the secondary markets, exchanges, brokers, and dealers.
Division of Investment Management - Oversees the investment advisers and investment companies under the Investment Company Act of 1940 and the Investment Advisers Act of 1949.
What is required to be in the Management’s Discussion and Analysis (MD&A) that is part of the 10-K?
MD&A must include discussion and analysis of operating results, liquidity, and capital resources, trends, and risks and uncertainties. Where there are increases in sales, management must discuss the extent that price, volume, or new products contributed to the increase.
What are the two regulations that govern securities?
Regulation S-X: Governs the form and content of financial statements and financial statement disclosures.
Regulation S-K: Governs the form and content of non-financial statement disclosures.
Filing deadlines for 10-K and 10-Q by company size
Large Accelerated Filer: worldwide market value of outstanding voting and nonvoting common equity held by non-affiliates of >$700M: file 10-K up to 60 days after FYE, file 10-Q up to 40 days after quarter end.
Accelerated Filer: worldwide market value of outstanding voting and nonvoting common equity held by non-affiliates of $75M - 700M: file 10-K up to 75 days after FYE, 10-Q up to 40 days after quarter end.
Non-accelerated Filer: worldwide market value of outstanding voting and nonvoting common equity held by non-affiliates of
Is the Form 10-Q as extensive as the Form 10-K?
Form 10-Q is not as extensive as the 10-K and include information for the specific quarter and year-to-date information. Only the first three quarters are reported because the 10-K reports the annual information.
The 10-Q is not required to be audited but must be reviewed by the independent auditor.
Financial statements presented in the Form 10-Q are:
- Balance sheet for the quarter and prior fiscal year end.
- Quarterly and year to date income statements for this quarter and the same period in the previous year.
- Cumulative year-to-date statements of cash flow for the current year and prior fiscal years.
A foreign private issuer is any issuer other than a foreign govt, except ab issuer where more than 50% of the outstanding voting securities are directly or indirectly owned by residents if the US and what other condition?
A foreign private issuer is any foreign issuer other than a foreign government, except an issuer that meets the following conditions:
- More than 50% of outstanding voting securities are directly or indirectly owned by residents of the U.S., AND
- ANY of the following:
a) The business of the issuer is administered principally in the US.
b) More than 50% of the assets of the issuer are located in the US.
c) The majority of its executive officers are US citizens or residents.
