SEC Rules

Short-Swing Profit Rule

'Short-Swing Profit Rule' A Securities & Exchange Commission regulation that requires company insiders to return any profits made from the purchase and sale of company stock if both transactions occur within a six-month period.

A nonaccelerated filer must file its 10-Q within

45 days.

A large accelerated filer must file Form 10-K (annual report) within how many days of the end of their fiscal year?

60 days. Depending on the filer, the deadline is 60, 75, or 90 days

accrual system

A basic feature of financial accounting is that it is an accrual system under which the determination of periodic earnings and financial position is dependent upon the measurement of all economic resources and obligations (e.g., receivables and payables) and changes in them as the changes occur.

Required filings

A covered corporation is required to file annual (10-K), quarterly (10-Q), and current events (8-K) reports with the SEC. Similar reports are sent to shareholders. The 10-K report contains information about the entity's business activities, securities, management, related parties, disagreements about accounting principles and disclosure, audited financial statements, etc. It is intended to bring the information in the registration statement up to date. Thus, newly appointed officers will be listed.

Report changes in market price of stock

Although the annual report (Form 10-K) requires disclosure of the market price of the common stock of the registrant (including the high and low sales prices) for each quarter of the last 2 fiscal years and any subsequent interim periods, not every change in the market price of its stock need be reported.

8-K

Current reports must be filed on Form 8-K describing specified material events: (1) changes in control of the registrant, (2) the acquisition or disposition of a significant amount of assets not in the ordinary course of business, (3) bankruptcy or receivership, (4) resignation of a director, and (5) a change in the registrant's certifying accountant.

SEC

Empowered by Congress to establish principles for financial reporting by issuers (publicly traded companies) in the US. SEC delegated authority for detailed rule-making to FASB. SEC oversees and enforces FASB's principles by requiring periodic reporting, which allows investors to evaluate investments. SEC's division of enforcement investigates and prosecutes violations of securities laws.

10-Q

Form 10-Q is the quarterly report to the SEC. It must be filed within 40 days after the end of the period by large accelerated filers and accelerated filers. An entity required to file Form 10-K also must file Form 10-Q for each of the first three quarters. Form 10-Q must be filed within 40 days of the last day of the first three fiscal quarters by large accelerated filers ($700 million or more in public float) and accelerated filers ($75 million to $700 million) and within 45 days by non-accelerated filers (less than $75 million).

Is the content of the Management's Discussion and Analysis (MD&A) section of an annual report mandated by the SEC or FASB?

The content of the MD&A section is determined by regulations of the SEC. The MD&A, standard financial statements, summarized financial data for at least 5 years, and other matters must be included in annual reports to shareholders and in Form 10-K filed with the SEC. Forward-looking information in the form of forecasts is encouraged in the MD&A but not required.

MD&A

The content of the MD&A section is determined by regulations of the SEC. The MD&A, standard financial statements, summarized financial data for at least 5 years, and other matters must be included in annual reports to shareholders and in Form 10-K filed with the SEC. Forward-looking information in the form of forecasts is encouraged in the MD&A but not required.

Reporting on Tender Offers

The target need only file a statement with the SEC if the tender offer is hostile (unsolicited).

10-K

annual report to SEC Form 10-K must include audited financial statements: comparative balance sheets and statements of income, cash flows, and changes in equity.

Red Herring Prospectus

preliminary prospectus