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Flashcards in FAR - Securities Exchange Commission and Filing Deck (21):

When a company issues new securities. it is required to submit a registration statement to the

SEC that includes:


1. Disclosures about the securities being offered for sale.

2. The relationship of the new securities to the company's other securities.

3. Information similar to that filed in the annual filing.

4. Audited financial statements.

5. A description of business risk factors.


What is Form 10-K?

How many days to file for a Large accelerated filer, accelerated filer, and non accelerated filer?

10-k forms contain what?

Form 10-K must be filed annually by U.S. registered companies (issuers). It's a required annual report to the SEC and it's a comprehensive report of company's business and financial condition

The filing deadline for Form 10-K:
* Large accelerated filers ($700MM or more) = 60 days after end of fiscal year (for fiscal year after 12/152006)

* Accelerated filers ($75MM or more and less than $700MM) = 75 days after fiscal-year end

* Non-accelerated filers, all other registrants (less than $75MM) = 90 days after the end of the fiscal year

10-K Forms contain: financial disclosures, including a summary of financial data, management's discussion and analysis (MD&A), and audited financial statements prepared using U.S. GAAP.


What is Form 10-Q?

Filing deadline for Largest accelerater, filer, accelerated filer, and non accelerated filer?

10-q contains what main info? Other info?

Form 10-Q must be filed quarterly by U.S. registered companies (issuers).

The filing deadline for Form 10-Q:
Large Accelerated Filers ($700MM or more) = 40 days
is 40 days after the END of the fiscal quarter

Accelerated filers ($75MM or more and less than $700MM) = 40 days after the END of the fiscal quarter

All other registrants (non-accelerated filers) = 45 days after END of fiscal quarter.

Form 10-Q CONTAINS main info:
* Unaudited financial statements prepared using U.S. GAAP,
* Interim period MD&A (Management's discussion and analysis) of financial condition and results of operations
* and certain Quantitative and qualitative disclosures about market risk
*  Controls and procedures

* Other information such as: (1)   Legal proceedings
(2)   Risk factors
(3)   Unregistered sales of equity securities and use of proceeds
(4)   Defaults upon senior securities


What is Form 11-K?

Form 11-K = This is the annual report of a U.S. company's Employee Benefit Plan(s).


Forms 20-F and 40-F

Filed by foreign private issuers to the SEC.

Form 40-F is filed by specific Canadian companies registered with the SEC.

Form 20-F is filed by other non-U.S. registrants.

Form 40-F (Canadian companies) and Form 20-F (other Foreign companies:
* Similar to Form 10-K
* Contains financial disclosures, including a Summary of Financial data, management's discussion and analysis (MD&A), and audited financial statements.

The Audited financial statements may be prepared using U.S. GAAP, IFRS, or Not-GAAP/Not-IFRS comprehensive body of accounting principles.

If a comprehensive body of accounting principles (NOT US GAAP or IFRS) is used, Need to provide certain Reconciliations to U.S. GAAP.


What is Form 6-K?

Form 6-K

= This form is filed SEMI-Annually by Foreign private issuers.

= This form is similar to the Form 10-Q and contains unaudited financial statements, interim period MD&A, and certain disclosures.


What is Form 8-K?

Form 8-K

This form is filed to report:
(1) major corporate events such as corporate asset acquisitions or disposals or
(2) changes in securities and trading markets such as the unregistered sale of equity securities,
(3) changes to certifying accountants or financial statements,
(4) and changes in Corporate Governance or Management.
(5) The creation of an obligation under an off-balance sheet arrangement


What is Forms 3, 4 and 5?

Forms 3, 4 and 5

These forms are required to be filed by directors, officers, or beneficial owners of more than 10% of a class of equity securities of a registered company.

Summary: 10% owners/directors/officers file this.


What is Regulation S-K?

Regulation S-K (17 CFR Part 229) contains the instructions for filing the nonfinancial statement forms required by the SEC as under Securities Act of 1933, Securities Exchange Act of 1934, and Energy Policy and Conservation Act of 1975.


What is regulation S-X?

Regulation S-X contains information regarding the financial statements that must be submitted to the SEC.
SEC Regulation S-X (17 CFR Part 210) prescribes the form and content of, and the requirements for, financial statements.


True or False

There are no such documents as the “SEC Form Guide” or “Regulation 10-K-I (Instructions).”




REGULATION S-X - Statements and Periods Presented for 10-K and for 10-Q

The interim financial statements should include the following:

a. Balance sheets: need 2 (need 3rd one if seasonal fluctuations)
(1) The end of the most Recent fiscal Quarter
(2) and The end of the Preceding fiscal Year.

(3) A balance sheet for the corresponding fiscal quarter
of the preceding fiscal year (Prior Fiscal year's corresponding Fiscal quarter) is not required.

But if company has seasonal fluctuations then present a balance sheet for corresponding recent fiscal quarter of prior fiscal year (Last Fiscal year's fiscal quarter).

b. Income statements: need 2
(1) Most recent fiscal quarter: Period between Preceding Fiscal Year End to Most Recent Fiscal Quarter-end.
(2) And Corresponding periods of Preceding Fiscal year-end to the

(3) May include income statements for the cumulative 12-month period ended during the most Recent fiscal Quarter and for the Corresponding preceding period.

c. Statements of cash flows
(1) For the period between: Preceding Fiscal year end to Most recent fiscal quarter end
(2) and for the corresponding period for the preceding fiscal year.

(3) May also include Statement Cashflows for
"Cumulative 12-month period" ended during the most recent fiscal quarter and for the corresponding preceding period.


IFRS - Financial statement presentation

lFRS requires, at a minimum,

- Two balance sheets,
- Two statements of comprehensive income (and net income, if using the two-statement approach).
- Two statements of changes in equity,
- Two statements of cash flows and related notes.


How are Forms 10-K and Form 10-Q filed with the SEC?

The forms must be filed electronically on EDGAR unless this filing causes hardship on the filing company.


What Balance sheets needed to file with Form 10-Q (as in like as of what time period)?

Form 10-Q is used to file quarterly reports with the SEC. Required financial statements include

(1) A quarterly (most recent quarterly) balance sheet
(2) End of the preceding fiscal year balance sheet.

If the company is subject to seasonal fluctuations, a balance sheet for the corresponding quarter of the prior fiscal year is required.


The Securities and Exchange Commission was created under which act?

The 1934 Securities Exchange Act


SEC's rulemaking procedures identified on their website include what steps (http://www.sec.gov/answers/rulemaking.htm)?

Concept Release

Rule Proposal

Rule Adoption

website: http://www.sec.gov/answers/rulemaking.htm


SEC's rulemaking procedures - Concept Release

A concept release is issued describing the area of interest and the SEC's identifying different approaches to addressing the problem, followed by a series of questions that seek the views of the public on the issue.

The public's feedback is taken into consideration as the SEC decides which approach, if any, is appropriate.

Concept release is used instead of Rule Proposal if the issue is unique or too complicated.


SEC's rulemaking procedures - Rule Proposal

Rule Proposal: The SEC publishes a detailed formal rule proposal for public comment.

Unlike a concept release, a rule proposal advances specific objectives and methods for achieving them. (Narrowed focus on here is the issue and these are the specific methods to resolve the issue)

Typically, the SEC provides between 30 and 60 days for review and comment. Just as with a concept release, the public comment is considered vital to the formulation of a final rule.


SEC's rulemaking procedures - Rule Adoption

Rule Adoption: Finally, the SEC Commissioners consider what they have learned from the public of the proposed rule, and seek to agree on the specifics of a final rule. 

If a final measure is then adopted by vote of the full Commission, it becomes part of the official rules that govern the securities industry.


True or false

(1) SEC is responsible for setting all the accounting standards outlined in GAAP.

(2) SEC issues Financial reporting releases that generally agrees with US GAAP.

(1) False
(2) True

The Securities and Exchange Commission (SEC) is a governmental entity created to protect the interest of
investors by ensuring full and adequate disclosure by publicly traded companies.

Although the SEC has the authority to establish standards, it has generally deferred to the Financial Accounting Standards Board (FASB) or its predecessors to generate U.S. accounting standards.

The SEC does issue its own rules in the form of Financial Reporting Releases, which generally agree with U.S. GAAP.

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