US Securities and Exchange Commission (SEC)

Question 1

The SEC has no enforcement power.

Answer 1

False

Question 2

The Securities and Exchange Commission (SEC) has the legal authority to prescribe accounting standards, but has delegated standard setting to the private sector.

Answer 2

True

Question 3

Financial Reporting Releases are the formal pronouncements issued by the SEC that must be adhered to by public companies.

Answer 3

True

Question 4

Public companies must adhere to SEC pronouncements.

Answer 4

True

Question 5

Division of Accountants is not a division of the SEC.

Answer 5

True

Question 6

The SEC is not a member of the International Organization of Securities Commissions (IOSCO).

Answer 6

False

Question 7

A foreign private issuer would not have the following characteristic:

The foreign issuer is a foreign government.

Answer 7

True

Question 8

The SEC does not acknowledge or accept financial statements in compliance with IASB approved IFRS.

Answer 8

False

Question 9

Since 2008, the SEC has permitted foreign private issuers to file their financial statements using:

Answer 9

IFRS as issued by the IASB.

Question 10

The SEC defines a foreign private issuer as any issuer other than a foreign government, except an issuer that where more than 50% of the outstanding voting securities are directly or indirectly owned by residents of the U.S. and what other condition?

Answer 10

he majority of its executive officers or directors are U.S. citizens or residents.

Question 11

Even though the SEC delegates the creation of accounting standards to the private sector, the SEC frequently comments on accounting and auditing issues. The main pronouncements published by the SEC are:

Answer 11

Financial Reporting Releases (FRR).

The main pronouncements published by the SEC are the Financial Reporting Releases (FRR) and the Staff Accounting Bulletins (SAB).

Question 12

The SEC enforces the corporate registration requirements of the Securities Act of 1933 as one of its principal objectives. These requirements are intended to provide information that enables the SEC to:

Answer 12

Ensure that investors are provided with adequate information on which to base investment decisions.

Question 13

The SEC is comprised of five commissioners, appointed by the President of the United States, and four divisions. What division is responsible for overseeing compliance with the securities acts?

Answer 13

Division of Corporate Finance.

Question 14

2 years balance sheets, 3 years income statement, statements of cash flows, and shareholders’ equity are the audited financial statements provided upon initial registration of a security.

Answer 14

True

Question 15

Regulation S-K governs non-financial statement disclosures in Form 10-K.

Answer 15

True

Question 16

Initial registration of securities is typically done via Form S-1.

Answer 16

True

Question 17

Regulation S-X governs form and content of financial statements.

Answer 17

True

Question 18

Notes, debentures, or evidence of indebtedness would not be considered a security that requires registration.

Answer 18

False

Question 19

The 10-k for a large accelerated filer is required to be filed within 60 days of the fiscal year end.

Answer 19

True

Question 20

The 1933 Securities Act governs the registration and trading of all public securities.

Answer 20

False

Governed by SEC

Question 21

The 10-Q for a large accelerated filer is required to be filed within 45 days of the fiscal year end.

Answer 21

False

Should be filed within 40 days.

Question 22

Audited financial information is included in Part II, Item 8 of Form 10-k.

Answer 22

True

Question 23

Regulation S-X requires reporting on disagreements with accountants.

Answer 23

False

Question 24

10-k is the form required for annual filing of a public company.

Answer 24

True

Question 25

Management’s Discussion and Analysis (MD&A) is governed by Regulation S-X.

Answer 25

False

Question 26

Example of requirement by Regulation S-K to be included in the Management’s Discussion and Analysis (MD&A) that is part of the 10-K.

Answer 26

Discussion of risks and uncertainties.

Question 27

Which regulation governs the form and content of financial statement disclosures?

Answer 27

Regulation S-X

Question 28

A company that is a large accelerated filer must file its Form 10-Q with the United States Securities and Exchange Commission within how many days after the end of the period?

Answer 28

40 days

Question 29

A company is required to file quarterly financial statements with the United States Securities and Exchange Commission on Form 10-Q. The company operates in an industry that is not subject to seasonal fluctuations, which could have a significant impact on its financial condition. In addition to the most recent quarter end, what period is the company required to present Balance Sheets on Form 10-Q?

Answer 29

The end of preceding fiscal year.

The Balance Sheet for the end of the preceding fiscal year would have been the last audited Balance Sheet. This Balance Sheet is presented along with the current fiscal quarter.

Question 30

A company is an accelerated filer that is required to file Form 10-K with the United States Securities and Exchange Commission (SEC). What is the maximum number of days after the company’s fiscal year end that the company has to file Form 10-K with the SEC?

Answer 30

75 days