23 terms

FAR- US Securities & Exchange

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Does the Securities and Exchange Commission (SEC) have the authority to penalize firms when financial statements are not in accordance with generally accepted accounting principles?
Yes, it may penalize firms.
What purpose do Accounting and Auditing Enforcement Releases (AAER) serve?
They report the enforcement actions taken against accountants.
Define "Financial Reporting Releases (FRR)."
Formal pronouncements that rank the highest in authority for public companies
What does the Securities and Exchange Commission (SEC) strive to do?
Ensure that there is adequate information in the public domain before a company issues or trades securities
Define "Staff Accounting Bulletins (SAB)."
Bulletins that provide the Security and Exchange Commission's current position on technical issues
How many divisions does the Securities and Exchange Commission (SEC) have?
a. Division of Corporation Finance
b. Division of Enforcement
c. Division of Trading and Markets
d. Division of Investment Management
When the Securities and Exchange Commission (SEC) finds an accounting irregularity, what happens?
The SEC sends a "deficiency" letter to a registrant when an accounting irregularity is found.
Does the Securities and Exchange Commission (SEC) have legal authority to prescribe accounting standards to public companies?
Yes, it has that authority.
What law prohibits the bribing of foreign officials?
The Foreign Corrupt Practices Act of 1977
What information does management discussion & analysis (MD&A) provide?
A discussion of important aspects of the firm from the viewpoint of management
How many years of selected financial data are required by the Securities and Exchange Commission (SEC)?
Five years are required.
Within how many days after the end of the quarter does a company need to file the 10-Q?
a. 40 days for large accelerated filers and accelerated filers
b. days for nonaccelerated filers
What does the Securities Act of 1934 do?
It regulates the trading of securities after they are issued and requires periodic reporting.
What information does the 8-K provide?
Significant events affecting the company
How many years of cash flow data are required by the Securities and Exchange Commission (SEC)?
Three years are required.
109.) How many years of balance sheet data are required by the Securities and Exchange Commission (SEC)?
a. Two years are required.
What are the steps in the offering process?
a. Issuer
b. Underwriter
c. Dealer
d. Public
How many years of income statement data are required by the Securities and Exchange Commission (SEC)?
Three years are required
Where are the formal rules of the Securities and Exchange Commission (SEC) found?
In the Code of Federal Regulations
What information does management discussion & analysis (MD&A) cover?
a. The firm's financial condition
b. Changes in financial condition
c. Results of operations
d. Liquidity
e. Capital resources and operations
f. Indications in trends, significant events, and uncertainties
Within how many days after the fiscal year end of a large accelerated filer does a 10-K need to be filed?
60 days
Does the Sarbanes-Oxley Act allow auditors to complete nonaudit services for clients?
No, the Sarbanes-Oxley Act does not allow this
What does registration with the Securities and Exchange Commission (SEC) require?
Extensive disclosures about the company, management, and the intended use of the proceeds from the issue