Chapter 12

Securities Act of 1934

-Created the SEC -Regulates the subsequent trading of securities through brokers and exchanges -Covers all subsequent, quarterly and annual filings

Registration Statement

-Registration statements ensure the disclosure of sufficient, relevant financial data before either a company or its underwriters can initially offer a security to the public. The Securities Act of 1933 mandates dissemination of such information. Registration is necessary except in certain situations described at a later point in this chapter. The SEC charges a registration fee based on the value of the securities offered. -Related to IPOs

Regulation S-K

-Supplemented by periodic releases and staff bulletins. -Established requirements for all nonfinancial information contained in filings with the SEC. -A partial list of other nonfinancial data to be disclosed includes specified data about the company's directors, officers, and other management; management's discussion and analysis of the current financial condition and the results of operations; and descriptions of both legal proceedings and the company's properties.

Regulation S-X

-Supplemented by periodic releases and staff bulletins. -Prescribed the form and content of the financial statements (and the accompanying notes and related schedules) included in the various reports filed with the SEC. -Before being accepted, all financial information must meet a number of clearly specified requirements established by Regulation S-X.

Form 10-Q

-a quarterly report -A 10-Q form contains condensed interim financial statements for the registrant and must be filed with the SEC shortly after the end of each quarter. However, no Form 10-Q is required following the fourth quarter of the year since a Form 10-K is forthcoming shortly thereafter. A Form 10-Q does not have to be audited by an independent CPA. Information to be contained in each Form 10-Q includes the following: • Income statements must be included for the most recent quarter and for the year to date as well as for the comparative periods in the previous year. • A statement of cash flows is also necessary, but only for the year to date as well as for the corresponding period in the preceding year. • Two balance sheets are reported: one as of the end of the most recent quarter and the second showing the company's financial position at the end of the previous fiscal year. • Each Form 10-Q should also include any needed disclosures pertaining to the current period including the MD&A of the financial condition of the company and results of operations.

Form 10-K

-an annual report -A 10-K form is an annual report filed with the SEC to provide information and disclosures required by Regulation S-K and Regulation S-X. Fortunately, because of the integrated disclosure system, the annual report distributed by companies to their stockholders now includes most of the basic financial disclosures required by the SEC in Form 10-K. Thus, many companies simply attach the stockholders' annual report to the -Form 10-K each year and use the incorporation by reference procedure to meet most of the SEC's filing requirements. This process is sometimes known as a wraparound filing.

Form 8-K

-disclosure of significant events -An 8-K form is used to disclose a unique or significant happening. 43 Consequently, the 8-K is not filed at regular time intervals but within 15 calendar days of the event (or within five business days in certain specified instances). The SEC receives thousands of 8-K reports each year. According to the SEC's guidelines, Form 8-K may be filed to report any action that company officials believe is important to security holders. However, the following events are designated for required disclosure in this manner: • Resignation of a director. • Changes in control of the registrant. • Acquisition or disposition of assets. • Changes in the registrant's certified public accountants (independent auditors). • Bankruptcy or receivership.

Securities Act of 1933

Regulates the initial offering of securities by a company or underwriter.

MD&A

The MD&A is required supplemental information that "should provide an objective and easily readable analysis of the government's financial activities based on currently known facts, decisions, or conditions."