SEC Filings by Jimmy Gentry
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SEC Filings by Jimmy Gentry



Jimmy Gentry presents "SEC Filings" during the annual 2012 Reynolds Business Journalism Seminars, hosted by the Donald W. Reynolds National Center for Business Journalism. ...

Jimmy Gentry presents "SEC Filings" during the annual 2012 Reynolds Business Journalism Seminars, hosted by the Donald W. Reynolds National Center for Business Journalism.

For more information about free training for business journalists, please visit



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SEC Filings by Jimmy Gentry SEC Filings by Jimmy Gentry Presentation Transcript

  • Securities and Exchange Commission Filings
            • Strictly Financials
            • Jan. 3, 2012
    Strictly Financials
    • Donald W. Reynolds National Center
    • For Business Journalism
    • At Arizona State University
    Strictly Financials
    • James K. Gentry, Ph.D.
    • Clyde M. Reed Teaching Professor
    • School of Journalism and Mass Communications
    • University of Kansas
    • [email_address]
    Strictly Financials
  • Securities and Exchange Commission
    • Created in wake of Crash of 1929 to restore faith in markets
    • Securities Act of 1933
    • Securities Exchange Act of 1934
    • Justice Brandeis’ role
    Strictly Financials
  • SEC Role
    • Protect investors through disclosure of certain information
    • Maintain a fair, orderly and efficient trading market, i.e. prevent misrepresentation
    • Maintain investor confidence
    • Facilitate capital formation
    Strictly Financials
  • SEC Philosophy
    • All investors should have access to certain basic information about an investment before buying it and as long as they hold it.
    Strictly Financials
  • Who Files
    • Companies with more than $10 million in assets whose securities are held by more than 500 owners must file annual and other periodic reports.
    Strictly Financials
  • Accessing SEC Documents
    •, other financial sites
    • Company websites
    • SEC:
    • SEC Filings and Forms (EDGAR)
    • EDGAR: Electronic Data Gathering, Analysis and Retrieval System
    Strictly Financials
  • Key SEC Documents
    • 10-K
    • 8-K
    • 10-Q
    • Proxy statement
    • Prospectus
    • Form 13-D
    • Form 4
    Strictly Financials
  • Form 10-K or Annual Report
    • Historically, had been filed within 90 days after end of company fiscal year
    • Today, 60, 75 or 90 days after fiscal year ends, depending on company’s public float
    • Extensive financial data, including income statement, balance sheet and statement of cash flows
    Strictly Financials
  • Form 10-K (cont.)
    • Extensive company information
    • Auditor’s report
    • MD&A or Management Discussion and Analysis
    • Extensive footnotes
    Strictly Financials
  • Form 8-K or Current Update
    • “ Material events”
    • Since August 2004, companies have four business days to file
    • SEC posts them almost instantly upon receipt
    • Number of filings more than doubled since rule change but has slowed
    Strictly Financials
  • Form 8-K (cont.)
    • Change in company auditor and why
    • Bankruptcy-protection filing
    • Expanded disclosure involving director or officer resignation or appointments
    • Restatement of financial results
    • Key litigation
    • Termination of material agreements
    Strictly Financials
  • Form 8-K (cont.)
    • Notice of de-listing by a stock exchange
    • Significant costs of leaving a biz
    • New off-books deals involving significant debt
    • Changes in company bylaws
    • Changes in company fiscal year
    Strictly Financials
  • Form 10-Q or Quarterly Update
    • Activities for the quarter (1, 2, 3)
    • Legal proceedings
    • Defaults
    • Labor negotiations
    • Discussion of “seasonality”
    • MD&A
    • Site of incorporation
    Strictly Financials
  • Form 10-Q (cont.)
    • Many companies file 8-K with earnings release
    • “ Material facts” must be in the 10-Q that might not be included in the 10-K
    • Key point: Unaudited
    Strictly Financials
  • Form 14 or Proxy Statement
    • Information regarding upcoming annual meeting
    • Matters to be voted on at meeting
    • Executive compensation
    • Information on board members
    • Shareholder proposals
    • Major shareholders
    Strictly Financials
  • Form S-1 or Registration Statement
    • Also called prospectus
    • Going public or selling new shares
    • Financing, use of proceeds
    • “ Risk factors”
    • Part I and Part II
    • “ Red herring”
    Strictly Financials
  • Form S-1 (cont.)
    • Look at exhibits, which may include the CEO’s employment contract or a list of the company’s real estate around the world
    Strictly Financials
  • Form13-D
    • Must be filed by any outside investor who buys 5 percent or more of a public company’s stock
    • Information on investors, even if are private partnerships of individuals
    Strictly Financials
  • Form 4
    • Announces changes in holdings of directors and officers (even if hold no stock), and shareholders owning 10 percent or more of the company’s stock
    Strictly Financials
  • Comment Letters
    • SEC posting online comment letters that it sends to public companies and mutual funds about their annual reports, public offerings and other filings
    • Makes it easier for investors and company rivals to understand the weaknesses of the disclosures and what financial issues are of concern to regulators
    Strictly Financials
  • Why A Private Company Files With SEC
    • If a private company has any debt that trades on an exchange . Even if a public company is bought by a private equity group and taken private, the obligation to file with the SEC continues if the debt remains under previous conditions.
    Strictly Financials
  • Why A Private Company Files With SEC
    • If the debt was issued on a registration statement and is held by more than 500 holders of record, even if it is not traded on an exchange. Obligation continues until the number of shareholders of record falls below 300.
    Strictly Financials
  • Why A Private Company Files With SEC
    • If a company sold bonds or notes as part of a contract sale and the buyer said the company must file with the SEC until the bonds are retired . Most common reason.
    Strictly Financials
  • SEC Commissioners
    • Mary Schapiro, D, Chairman
    • Daniel Gallagher, R, Commissioner
    • Troy Paredes, R, Commissioner
    • Luis Aguilar, D, Commissioner
    • Elisse Walter, D, Commissioner
    Strictly Financials
  • SEC Commissioners (cont.)
    • Serve five-year terms
    • Appointed by the president
    • No more than three from the same political party
    Strictly Financials
  • SEC Commissioners (cont.)
    • Interpret federal securities laws
    • Amend existing rules
    • Propose new rules to address changing market conditions
    • Enforce rules and laws
    Strictly Financials
  • SEC Challenges
    • Approximately 15,000+ public companies
    • Before 2004, SEC had about 3,100 employees, small by federal agency standards
    • Over last four years has had 3,500 – 3,600 employees and a budget of approximately $900 million
    • Because of flat budgets, been 10 percent reduction of employees and cut of more than 50 percent in new technology investments
    Strictly Financials
  • SEC Challenges (cont.)
    • Requested $1.03 billion for FY 2010 and $1.2 billion for FY 2011
    • Discussion of making it self-funded with control of its own budget
    • Has twice the turnover of the average government agency
    • 2 1/2 years is average employment of an SEC attorney
    Strictly Financials
  • SEC Challenges (cont.)
    • For three years before Enron’s bankruptcy, the SEC did not review its filings
    • Market meltdown of 2008
    • Bernard Madoff
    Strictly Financials
  • SEC Revolving Door
    • In summer 2004:
    • Enforcement division manager to partner in major law firm (white-collar defense)
    • Regional director to partner in major law firm (white-collar defense)
    • Deputy director, investment management, to major bank (compliance)
    • Associate director to major law firm (securities practice)
    Strictly Financials
  • SEC Uncertain Future
    • XBRL – eXtensible Business Reporting Language
    • Frustration with its performance
    • Legislative self-righteousness
    • Various proposals for restructuring oversight
    Strictly Financials