Why is SEC compliance necessary for public companies?

SEC compliance ensures that public companies maintain transparency, accuracy, and timely disclosure of information, which is essential for protecting investors. Filing financial and event-specific reports with the SEC allows investors to make informed decisions based on the company’s operational and financial health.

What are the main forms public companies must file with the SEC?

Public companies must file the 10-K (annual financial report), 10-Q (quarterly financial report), and 8-K (for significant events such as acquisitions, delisting, or executive changes). These filings provide investors with regular updates on the company’s performance and any major corporate events.

What is SOX compliance, and how does it impact reporting?

SOX (Sarbanes-Oxley Act of 2002) compliance requires public companies to implement internal controls and certify financial statements to prevent fraud. CEOs and CFOs must verify the accuracy of financial reports, and fraudulent certifications can lead to severe legal consequences. Internal control over financial reporting (ICFR) is a key aspect of SOX that the SEC enforces.

What is EDGAR, and why must companies use it?

EDGAR (Electronic Data Gathering, Analysis, and Retrieval system) is the SEC’s platform for electronic filing of financial and event-specific disclosures. It streamlines the filing process and makes records publicly accessible, promoting transparency. Non-compliance with EDGAR can harm a company’s reputation and lead to regulatory penalties.

How can lawyers assist with SEC compliance?

Lawyers help with SEC compliance by ensuring that companies meet filing requirements, interpret complex regulations, and reduce liability risks. They assist with disclosure decisions, prepare Regulation Fair Disclosure policies, advise on liability, establish compliance programs, and conduct internal investigations to support ongoing regulatory adherence.

SEC Reporting and Compliance

SEC Reporting And Compliance

The Securities and Exchange Commission is where public companies need to file their financial or auditory disclosures. The SEC requires transparency, accuracy, and timely information from companies in order to protect investors. Annual and quarterly reports need to be filed with the SEC on an ongoing basis if you want your company to be able to provide to consumers. Acquisitions or deposits of assets are just some of the reports that need to be filed with the SEC.

Periodic Filing Forms

Public companies will be using 3 forms for the majority of their SEC filings. The first form is the 10-K, which is used for the annual report. An annual report will share the company’s yearly financial information and sales of securities.

Another form, the 10-Q is used for a quarterly disclosure of finances. Quarterly will provide a bigger picture of the business’s compensation and risk factors when all compiled together.

The final form that is used for public companies is the 8-K form, which is only used in special circumstances for significant events. Some trigger events that will require an 8-K form filing include:

Entry into a definitive agreement
Termination of an agreement
Completion of acquisition
Notice of delisting or failure to satisfy a continued listing
Unregistered sales
Modifications to rights of security holders
Changes to the company accountant
Changes in control of the company
Election of new directors
Amendments to bylaws

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Other Reports Required By The SEC

There are many reports that are required of a public business in a timely manner. Most reports need to be filled with the SEC within 4 days after the occurrence of the event. Events like changing your company accountant, unregistered sales, or disposition of assets will require a filing. Here are some of the most important filing requirements with the SEC.

SOX Compliance

Under the Sarbanes-Oxley Act of 2002, public companies must follow strict guidelines for internal controls. Certification from the CEO and CFO is required on the financial statements to prevent financial fraud. Those who sign off on fraudulent reportings could face extensive legal consequences. Internal controls over financial reporting (ICFR) are one of the most important aspects that the SEC governs.

Insider Trading And Ownership Reporting

Executives and shareholders are considered insiders of a company. These people must report their stock holding and transactions within the company using Forms 3, 4, and 5 to maintain transparency. A company that wants to avoid insider trading claims needs to file with the SEC frequently.

Proxy Statements

During shareholder meetings, companies need to keep detailed information on what issues are up for voting. Board appointments, executive pay, and stock plans help a company make informed decisions. These statements are also known as Schedule 14A.

EDGAR Compliance

The Electronic Data Gathering, Analysis, and Retrieval system (EDGAR) is there to help streamline the company’s filing process. The SEC may require some companies to file electronically for several reasons. Using this electronic system will make the records public, making timely disclosures possible. Non-compliance with any of these regulations could result in damage to your reputation.

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Exchange Act Registration

Often referred to as the Exchange Act, the Securities Exchange Act of 1934 requires companies who want to list their securities publicly to comply with securities law and be transparent about finances to their investors.

Under the Exchange Act companies need to file annual reports, quarterly reports, and reports for significant events. In summary, companies need to disclose information that could help minimize risk for investors and follow rules that prevent fraudulent activities.

How Lawyers Help With SEC Compliance

Hiring a lawyer can help you meet SEC requirements and file the correct forms. Legal help will ensure the Securities Act registration forms are clear and precise. They can also help explain the legal jargon of the different acts so that you understand what you are getting into with public offerings.

Additional things that a lawyer can assist you with include:

Assisting with disclosure judgments
Considering the board of directors
Working with the staff of the national securities exchanges
Prepare Regulation Fair Disclosure Policies
Consistent help with reports and other SEC filings
Present information that minimizes liability risks
Establish internal compliance programs
Conduct internal investigations
Advise on potential liabilities

WW Partners can help you with all aspects of public business offerings. Our legal team wants to help improve your capital and stock offered to investors with proper SEC compliance.

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Frequently Asked Questions (FAQs) on SEC Reporting and Compliance

Why is SEC compliance necessary for public companies?

SEC compliance ensures that public companies maintain transparency, accuracy, and timely disclosure of information, which is essential for protecting investors. Filing financial and event-specific reports with the SEC allows investors to make informed decisions based on the company’s operational and financial health.
What are the main forms public companies must file with the SEC?

Public companies must file the 10-K (annual financial report), 10-Q (quarterly financial report), and 8-K (for significant events such as acquisitions, delisting, or executive changes). These filings provide investors with regular updates on the company’s performance and any major corporate events.
What is SOX compliance, and how does it impact reporting?

SOX (Sarbanes-Oxley Act of 2002) compliance requires public companies to implement internal controls and certify financial statements to prevent fraud. CEOs and CFOs must verify the accuracy of financial reports, and fraudulent certifications can lead to severe legal consequences. Internal control over financial reporting (ICFR) is a key aspect of SOX that the SEC enforces.
What is EDGAR, and why must companies use it?

EDGAR (Electronic Data Gathering, Analysis, and Retrieval system) is the SEC’s platform for electronic filing of financial and event-specific disclosures. It streamlines the filing process and makes records publicly accessible, promoting transparency. Non-compliance with EDGAR can harm a company’s reputation and lead to regulatory penalties.
How can lawyers assist with SEC compliance?

Lawyers help with SEC compliance by ensuring that companies meet filing requirements, interpret complex regulations, and reduce liability risks. They assist with disclosure decisions, prepare Regulation Fair Disclosure policies, advise on liability, establish compliance programs, and conduct internal investigations to support ongoing regulatory adherence.