This document discusses the requirements and process for preparing and distributing a company's annual report to shareholders. It covers SEC rules requiring companies to prepare an annual report and distribute it to shareholders. It outlines the roles and responsibilities of management, directors, advisors and counsel in preparing the report. It also describes the typical format and contents of an annual report, including financial statements, letter to shareholders, business descriptions, and other information. Finally, it discusses delivery requirements for annual reports to the SEC and stock exchanges.

1. SEC compliance and disclosure-
session 12
Annual Report to Shareholders
(the case of GE)
By
Arthur Mboue, GE SEC reporting VP
Research conducted by Arthur Mboue

2. Cover page of the GE 2012 Annual
Report
Research conducted by Arthur Mboue

3. I- Requirements to prepare and distribute
the Annual Report
• Rule 14a-3 and 14c-3 under the Exchange Act
provide that proxy solicitation relating to an
Annual or special meeting of shareholders at
which directors are to be elected, or a written
consent in lieu of such a meeting must be
accompanied or preceded by an Annual Report
• Registrants are also required to post their
Annual Reports and other proxy materials on
their company websites, mostly investor
relations
Research conducted by Arthur Mboue

4. Role of the participants in the Annual
Report disclosure
• Advisor including Counsel
• They must make sure that
– All required disclosures are present
– Statistics and other information have been verified; and
– The disclosure is consistent with the registrant’s internal analyses
• Management of the Registrant
• They should
– Develop a good theme (2012 Annual Report GE works) and choose good
pictures, size of the document(landscape or portrait) and slogan
(thriving in the 21st century)
• They can use the services of public relation and advertising firms as consultants
– Draft the narrative disclosure highlighting the registrant’s performance
– Make sure that the letter to shareholders is drafted by either the
Chairman or/and the CEO of the company
– Review the entire Annual Report closely to ensure it’s free of fraud,
mistake or any aggressive statements
Research conducted by Arthur Mboue

5. Role of the participants in the annual
report disclosure
• Board of Directors
• It must
– Review the final copy of the Annual Report especially if a
least part of this report is incorporated by reference
from the Annual Report into the Form 10-K
– PS: You must understand securities law associated to
incorporation by reference, once you incorporate by
reference any thing, you invite the Staff to review that
document, at the same it means that you did review that
document, it is reliable and it is a part of your disclosure.
Research conducted by Arthur Mboue

6. Another was GE builds the world- you
see them in action, here
Research conducted by Arthur Mboue

7. II- Preparing the Annual Report/Format
• II.1.Two types of Annual Reports/Format
– Standard Annual Report under Rules 14a-3 and 14c-3 of the
Exchange Act
– Form 10-K wrap or wrap 10-K wrapped by a letter to shareholders
signed and dated by the chairman or CEO of the registrant and
‘glossy’ cover (including magnificent photographic pictures,
slogan and company logo) as landscape or portrait magazine or
the like
• II.2.Cover Page
• The cover page of the ‘standard’ Annual Report usually
provides
– The registrant’s name
– The registrant logo
– The year to which the Annual Report relates
– The background of the format is full of pictures of the working
employees, company equipment or the like to set the tone of the
marketing the company strength to the shareholders and readersResearch conducted by Arthur Mboue

8. II. Preparing the Annual Report/format
• II.3.Insider Front cover/operating highlights
• Registrant use
– Table of content or
– Table comparing the past years financial and operating highlights to that of
prior years
• II.4. Letter to Shareholders
– Signed and dated by the CEO or/and Chairman
– Content analysis will uncover
• Recent accomplishments of the company often tied to the particular theme
• Current activities of the company
• Plans for the future of the company
• Campaign to fight particular regulation or legislation
• Report of major changes
• Information regarding key customers or suppliers
– A few pages
• II.5-Text of the Annual Report
– Surrounded by photographs and variety of dates presented in various graphic
designs
– Style, increased brevity-the degree of brevity is very high
Research conducted by Arthur Mboue

9. II. Preparing the Annual Report/format
• II.6.Financial Statements and information
– A)-Required Financial Statements
• Audited consolidated balance sheets as of the end of the two
most recent fiscal years
• Audited consolidated statements of income and cash flows for
each of the three most recent fiscal years; and
• Unaudited consolidated quarterly financial data for the two
most recent fiscal years, except in the case of foreign private
issuers
• Selected financial data described in item 301 of Regulation S-K;
and
• Information relating to the registrant’s industry segments,
classes of similar products or services, foreign and domestic
operations and export sales
Research conducted by Arthur Mboue

10. II. Preparing the Annual Report/format
• II.6 Financial Statements and Information
– B)-Other Required information
• A brief description of the business of the registrant and its
subsidiaries
• MD&A of financial condition and results of operations required by
item 303 of Regulation 303 of Regulation S-K (it is identical to that
required in the Form 10-K)
• Quantitative and qualitative disclosure about market risk required
by item 305 of Regulation S-K
• Information concerning changes in and disagreement with
accountants required by item 304 of Regulation S-K
• The market price of, and dividends on, the registrant’s common
equity securities and related security holder matters as required by
Item 201 of Regulation S-K
• The performance graph required by Item 201e of Regulation S-K
(plot point, measurement period from published industry or line
business index and peer issuer data group);and
• Certain information concerning each of the registrant’s directors
and executive officersResearch conducted by Arthur Mboue

11. GE themes “GE works’
Research conducted by Arthur Mboue

12. II. Preparing the Annual Report/format
• C. Additional Information Commonly Provided
• The Annual Report can also include
– The date, time, and location of the registrant’s upcoming
annual meeting;
– The registrant’s web address(es), including contact
information for investor relations personnel
– The name of the registrant’s independent auditors
– Contact information for the registrant’s transfer agent
and registrar; and
– A safe harbor statement for forward looking statements.
Research conducted by Arthur Mboue

13. II. Preparing the Annual Report/format
• D. Form of Presentation
– Use of tables, schedules, charts and graphic illustrations
to present financial information
• E. Type size requirements
– Roman type at least as large and as legible as 10 point
modern type
– All type must be leaded at least 2 points
Research conducted by Arthur Mboue

14. III. DELIVERY TO THE SEC
• Seven copies of the Annual Report must be
mailed to the SEC no later than the date on
which such report is provided to shareholders.
Research conducted by Arthur Mboue

15. IV. Other Required Distributions of Annual Report
Required receivers Rule and Time of delivery Number of copies
NYSE Its members must simultaneously make their
Annual Reports available to shareholders on or
through the company ‘s website. It must be free
of charge to anyone. The press release must
specify the company’s website address and
indicate that shareholders have the ability to
receive a free of charge copy.
6 copies
AMEX Its members must simultaneously make their
Annual Reports available to shareholders on or
through the company’s website. It must be free
of charge to anyone and mostly shareholders.
3 copies
NASDAQ Its members must make it available within
‘reasonable period of time’ following the delivery
to the SEC
2 copies
Shareholder It must be delivered at least 20 calendar days
before the date of the meeting
1 copy
Research conducted by Arthur Mboue

16. GE Chairman/CEO Jeff Immelt letter to
shareholders image of man in control
Research conducted by Arthur Mboue