SEC Flashcards
SEC
Legal authority to set accounting standards BUT has delegated that resposibility to FASB
Purpose: Enforce compliance with GAAP for all publicly traded co, and IFRS for foreign registrants
Foreign Private Issuer
Non-governmental foreign issuer
majority of securities owned outside the the U.S.; officer and directors not US citizens/residents; majority of assets outside the US; business is administered principally outside the US
Structure
Five commissioners appointed by the President
Four divisions
and
Office of the Chief Accountant
Divisions
- Corporate Finance - compliance and filing submitted here
- Enforcement - investigate violations
- Trading and Markets - oversees secondary markets
- Investment managements - oversees investment advisors
Pronouncements
Authoritative GAAP for publicly traded companies
- FRR - Financial reporting releases - highest ranking
- SAB - Staff accounting bulletins - current position on technical issues
- AAER - Accounting and auditing enforcement releases - reports enforcement actions
Securities Act of 1933
Applies to the registration of the IPO of securities
- Form S-1 is the basic registration form
- Part 1 is the prospectus
- Part 2 has info about the cost of the issuance, directors and officers, additional financial schedules
IPO
Financial Statements - Must present 2 years of Balance Sheets, 3 year of Income Statemens, Cash Flow, and Statments of SE
5 years of selected financiak information as well
Process of IPO
Issuer —> underwriter —> Dealer (helps sell) —-> Public
1934 Act
Applies to reporting information about securities already issued;
Reg S-X provides guidance
10-K annual
10-Q quarterly
8-K significant events
10-K
Must be audited by an independent auditor
Significant disclosures plus 2, 3 yrs of financials
MD&A, internal control reports, auditors report, management certifications
10-Q
Way we get timely info; not audited only reviewed by the auditor,
Disclosures are not as significant
