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Securities and Exchange  Commission Filings <ul><ul><ul><ul><ul><li>Strictly Financials </li></ul></ul></ul></ul></ul><ul>...
<ul><li>Donald W. Reynolds National Center </li></ul><ul><li>For Business Journalism </li></ul><ul><li>At Arizona State Un...
<ul><li>James K. Gentry, Ph.D. </li></ul><ul><li>Clyde M. Reed Teaching Professor </li></ul><ul><li>School of Journalism a...
Securities and Exchange Commission <ul><li>Created in wake of Crash of 1929 to restore faith in markets </li></ul><ul><li>...
SEC Role <ul><li>Protect investors through disclosure of certain information </li></ul><ul><li>Maintain a fair, orderly an...
SEC Philosophy <ul><li>All investors should have access to certain basic information about an investment before buying it ...
Who Files <ul><li>Companies with more than $10 million in assets whose securities are held by more than 500 owners must fi...
Accessing SEC Documents <ul><li>Finance.yahoo, other financial sites </li></ul><ul><li>Company websites </li></ul><ul><li>...
Key SEC Documents <ul><li>10-K </li></ul><ul><li>8-K </li></ul><ul><li>10-Q </li></ul><ul><li>Proxy statement </li></ul><u...
Form 10-K or Annual Report <ul><li>Historically, had been filed within 90 days after end of company fiscal year </li></ul>...
Form 10-K (cont.) <ul><li>Extensive company information </li></ul><ul><li>Auditor’s report </li></ul><ul><li>MD&A or Manag...
Form 8-K or Current Update <ul><li>“ Material events” </li></ul><ul><li>Since August 2004, companies have four business da...
Form 8-K (cont.) <ul><li>Change in company auditor and why </li></ul><ul><li>Bankruptcy-protection filing </li></ul><ul><l...
Form 8-K (cont.) <ul><li>Notice of de-listing by a stock exchange </li></ul><ul><li>Significant costs of leaving a biz </l...
Form 10-Q or  Quarterly Update <ul><li>Activities for the quarter (1, 2, 3) </li></ul><ul><li>Legal proceedings </li></ul>...
Form 10-Q (cont.) <ul><li>Many companies file 8-K with earnings release </li></ul><ul><li>“ Material facts” must be in the...
Form 14 or Proxy Statement <ul><li>Information regarding upcoming annual meeting </li></ul><ul><li>Matters to be voted on ...
Form S-1 or Registration Statement <ul><li>Also called prospectus </li></ul><ul><li>Going public or selling new shares </l...
Form S-1 (cont.) <ul><li>Look at exhibits, which may include the CEO’s employment contract or a list of the company’s real...
Form13-D <ul><li>Must be filed by any outside investor who buys 5 percent or more of a public company’s stock  </li></ul><...
Form 4 <ul><li>Announces changes in holdings of directors and  officers (even if hold no stock), and shareholders owning 1...
Comment Letters <ul><li>SEC posting online comment letters that it sends to public companies and mutual funds about their ...
Why A Private Company  Files With SEC  <ul><li>If a private company has any debt that trades on an exchange .  Even if a p...
Why A Private Company  Files With SEC  <ul><li>If the debt was issued on a registration statement and is held by more than...
Why A Private Company  Files With SEC  <ul><li>If a company sold bonds or notes as part of a contract sale and the buyer s...
SEC Commissioners <ul><li>Mary Schapiro, D, Chairman </li></ul><ul><li>Daniel Gallagher, R, Commissioner </li></ul><ul><li...
SEC Commissioners (cont.) <ul><li>Serve five-year terms </li></ul><ul><li>Appointed by the president </li></ul><ul><li>No ...
SEC Commissioners (cont.) <ul><li>Interpret federal securities laws </li></ul><ul><li>Amend existing rules </li></ul><ul><...
SEC Challenges <ul><li>Approximately 15,000+ public companies </li></ul><ul><li>Before 2004, SEC had about 3,100  employee...
SEC Challenges (cont.) <ul><li>Requested $1.03 billion for FY 2010 and $1.2 billion for FY 2011 </li></ul><ul><li>Discussi...
SEC Challenges (cont.) <ul><li>For three years before Enron’s bankruptcy, the SEC did not review its filings </li></ul><ul...
SEC Revolving Door <ul><li>In summer 2004: </li></ul><ul><li>Enforcement division manager to partner in major law firm (wh...
SEC Uncertain Future <ul><li>XBRL – eXtensible Business Reporting Language  </li></ul><ul><li>Frustration with its perform...
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SEC Filings by Jimmy Gentry

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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 businessjournalism.org.

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SEC Filings by Jimmy Gentry

  1. 1. Securities and Exchange Commission Filings <ul><ul><ul><ul><ul><li>Strictly Financials </li></ul></ul></ul></ul></ul><ul><ul><ul><ul><ul><li>Jan. 3, 2012 </li></ul></ul></ul></ul></ul>Strictly Financials
  2. 2. <ul><li>Donald W. Reynolds National Center </li></ul><ul><li>For Business Journalism </li></ul><ul><li>At Arizona State University </li></ul>Strictly Financials
  3. 3. <ul><li>James K. Gentry, Ph.D. </li></ul><ul><li>Clyde M. Reed Teaching Professor </li></ul><ul><li>School of Journalism and Mass Communications </li></ul><ul><li>University of Kansas </li></ul><ul><li>[email_address] </li></ul>Strictly Financials
  4. 4. Securities and Exchange Commission <ul><li>Created in wake of Crash of 1929 to restore faith in markets </li></ul><ul><li>Securities Act of 1933 </li></ul><ul><li>Securities Exchange Act of 1934 </li></ul><ul><li>Justice Brandeis’ role </li></ul>Strictly Financials
  5. 5. SEC Role <ul><li>Protect investors through disclosure of certain information </li></ul><ul><li>Maintain a fair, orderly and efficient trading market, i.e. prevent misrepresentation </li></ul><ul><li>Maintain investor confidence </li></ul><ul><li>Facilitate capital formation </li></ul>Strictly Financials
  6. 6. SEC Philosophy <ul><li>All investors should have access to certain basic information about an investment before buying it and as long as they hold it. </li></ul>Strictly Financials
  7. 7. Who Files <ul><li>Companies with more than $10 million in assets whose securities are held by more than 500 owners must file annual and other periodic reports. </li></ul>Strictly Financials
  8. 8. Accessing SEC Documents <ul><li>Finance.yahoo, other financial sites </li></ul><ul><li>Company websites </li></ul><ul><li>SEC: www.sec.gov </li></ul><ul><li>SEC Filings and Forms (EDGAR) </li></ul><ul><ul><li>www.sec.gov/edgar.shtml </li></ul></ul><ul><li>EDGAR: Electronic Data Gathering, Analysis and Retrieval System </li></ul>Strictly Financials
  9. 9. Key SEC Documents <ul><li>10-K </li></ul><ul><li>8-K </li></ul><ul><li>10-Q </li></ul><ul><li>Proxy statement </li></ul><ul><li>Prospectus </li></ul><ul><li>Form 13-D </li></ul><ul><li>Form 4 </li></ul>Strictly Financials
  10. 10. Form 10-K or Annual Report <ul><li>Historically, had been filed within 90 days after end of company fiscal year </li></ul><ul><li>Today, 60, 75 or 90 days after fiscal year ends, depending on company’s public float </li></ul><ul><li>Extensive financial data, including income statement, balance sheet and statement of cash flows </li></ul>Strictly Financials
  11. 11. Form 10-K (cont.) <ul><li>Extensive company information </li></ul><ul><li>Auditor’s report </li></ul><ul><li>MD&A or Management Discussion and Analysis </li></ul><ul><li>Extensive footnotes </li></ul>Strictly Financials
  12. 12. Form 8-K or Current Update <ul><li>“ Material events” </li></ul><ul><li>Since August 2004, companies have four business days to file </li></ul><ul><li>SEC posts them almost instantly upon receipt </li></ul><ul><li>Number of filings more than doubled since rule change but has slowed </li></ul>Strictly Financials
  13. 13. Form 8-K (cont.) <ul><li>Change in company auditor and why </li></ul><ul><li>Bankruptcy-protection filing </li></ul><ul><li>Expanded disclosure involving director or officer resignation or appointments </li></ul><ul><li>Restatement of financial results </li></ul><ul><li>Key litigation </li></ul><ul><li>Termination of material agreements </li></ul>Strictly Financials
  14. 14. Form 8-K (cont.) <ul><li>Notice of de-listing by a stock exchange </li></ul><ul><li>Significant costs of leaving a biz </li></ul><ul><li>New off-books deals involving significant debt </li></ul><ul><li>Changes in company bylaws </li></ul><ul><li>Changes in company fiscal year </li></ul><ul><li>www.sec.gov/answers/form8k.htm </li></ul>Strictly Financials
  15. 15. Form 10-Q or Quarterly Update <ul><li>Activities for the quarter (1, 2, 3) </li></ul><ul><li>Legal proceedings </li></ul><ul><li>Defaults </li></ul><ul><li>Labor negotiations </li></ul><ul><li>Discussion of “seasonality” </li></ul><ul><li>MD&A </li></ul><ul><li>Site of incorporation </li></ul>Strictly Financials
  16. 16. Form 10-Q (cont.) <ul><li>Many companies file 8-K with earnings release </li></ul><ul><li>“ Material facts” must be in the 10-Q that might not be included in the 10-K </li></ul><ul><li>Key point: Unaudited </li></ul>Strictly Financials
  17. 17. Form 14 or Proxy Statement <ul><li>Information regarding upcoming annual meeting </li></ul><ul><li>Matters to be voted on at meeting </li></ul><ul><li>Executive compensation </li></ul><ul><li>Information on board members </li></ul><ul><li>Shareholder proposals </li></ul><ul><li>Major shareholders </li></ul>Strictly Financials
  18. 18. Form S-1 or Registration Statement <ul><li>Also called prospectus </li></ul><ul><li>Going public or selling new shares </li></ul><ul><li>Financing, use of proceeds </li></ul><ul><li>“ Risk factors” </li></ul><ul><li>Part I and Part II </li></ul><ul><li>“ Red herring” </li></ul>Strictly Financials
  19. 19. Form S-1 (cont.) <ul><li>Look at exhibits, which may include the CEO’s employment contract or a list of the company’s real estate around the world </li></ul>Strictly Financials
  20. 20. Form13-D <ul><li>Must be filed by any outside investor who buys 5 percent or more of a public company’s stock </li></ul><ul><li>Information on investors, even if are private partnerships of individuals </li></ul>Strictly Financials
  21. 21. Form 4 <ul><li>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 </li></ul>Strictly Financials
  22. 22. Comment Letters <ul><li>SEC posting online comment letters that it sends to public companies and mutual funds about their annual reports, public offerings and other filings </li></ul><ul><li>Makes it easier for investors and company rivals to understand the weaknesses of the disclosures and what financial issues are of concern to regulators </li></ul>Strictly Financials
  23. 23. Why A Private Company Files With SEC <ul><li>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. </li></ul>Strictly Financials
  24. 24. Why A Private Company Files With SEC <ul><li>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. </li></ul>Strictly Financials
  25. 25. Why A Private Company Files With SEC <ul><li>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. </li></ul>Strictly Financials
  26. 26. SEC Commissioners <ul><li>Mary Schapiro, D, Chairman </li></ul><ul><li>Daniel Gallagher, R, Commissioner </li></ul><ul><li>Troy Paredes, R, Commissioner </li></ul><ul><li>Luis Aguilar, D, Commissioner </li></ul><ul><li>Elisse Walter, D, Commissioner </li></ul>Strictly Financials
  27. 27. SEC Commissioners (cont.) <ul><li>Serve five-year terms </li></ul><ul><li>Appointed by the president </li></ul><ul><li>No more than three from the same political party </li></ul>Strictly Financials
  28. 28. SEC Commissioners (cont.) <ul><li>Interpret federal securities laws </li></ul><ul><li>Amend existing rules </li></ul><ul><li>Propose new rules to address changing market conditions </li></ul><ul><li>Enforce rules and laws </li></ul>Strictly Financials
  29. 29. SEC Challenges <ul><li>Approximately 15,000+ public companies </li></ul><ul><li>Before 2004, SEC had about 3,100 employees, small by federal agency standards </li></ul><ul><li>Over last four years has had 3,500 – 3,600 employees and a budget of approximately $900 million </li></ul><ul><li>Because of flat budgets, been 10 percent reduction of employees and cut of more than 50 percent in new technology investments </li></ul>Strictly Financials
  30. 30. SEC Challenges (cont.) <ul><li>Requested $1.03 billion for FY 2010 and $1.2 billion for FY 2011 </li></ul><ul><li>Discussion of making it self-funded with control of its own budget </li></ul><ul><li>Has twice the turnover of the average government agency </li></ul><ul><li>2 1/2 years is average employment of an SEC attorney </li></ul>Strictly Financials
  31. 31. SEC Challenges (cont.) <ul><li>For three years before Enron’s bankruptcy, the SEC did not review its filings </li></ul><ul><li>Market meltdown of 2008 </li></ul><ul><li>Bernard Madoff </li></ul>Strictly Financials
  32. 32. SEC Revolving Door <ul><li>In summer 2004: </li></ul><ul><li>Enforcement division manager to partner in major law firm (white-collar defense) </li></ul><ul><li>Regional director to partner in major law firm (white-collar defense) </li></ul><ul><li>Deputy director, investment management, to major bank (compliance) </li></ul><ul><li>Associate director to major law firm (securities practice) </li></ul>Strictly Financials
  33. 33. SEC Uncertain Future <ul><li>XBRL – eXtensible Business Reporting Language </li></ul><ul><li>Frustration with its performance </li></ul><ul><li>Legislative self-righteousness </li></ul><ul><li>Various proposals for restructuring oversight </li></ul>Strictly Financials

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