Question 1

Which of the following statements concerning pro forma disclosures is not true?
A)They show the effects of major transactions that occur after the end of the fiscal period.
B)They show the effects of major transactions that have occurred during the year but are not fully reflected in the company's historical cost financial statements.
C)The SEC requires these to be presented only when the company has made an unusual asset exchange,or a restructuring of existing indebtedness.
D)They often take the form of summarized financial statements.

Accepted Answer

Pro forma disclosures are not required by the SEC only when an unusual asset exchange or restructuring of existing indebtedness occurs. Pro forma disclosures may also be presented to show the effects of major transactions that occur after the end of the fiscal period or to show the effects of major transactions that have occurred during the year but are not fully reflected in the company's historical cost financial statements. Pro forma disclosures often take the form of summarized financial statements.

Question 2

Which of the following is defined as directly or indirectly having the power to vote the shares or investment power to sell the security?
A)Proxy
B)Significant influence
C)Control
D)Beneficial ownership

Accepted Answer

Beneficial ownership is defined as having the power to vote the shares or investment power to sell the security, either directly or indirectly. The other choices, such as proxy, significant influence, and control, may be related to ownership or decision-making, but they do not specifically refer to the power to vote or sell securities.

Question 3

Which system helps the SEC accomplish its primary purpose of increasing the efficiency and fairness of the securities markets by expediting the receipt,acceptance,dissemination,and analysis of time-sensitive data filed with it?
A)EDI
B)ESEC
C)EDGAR
D)EMMA

Accepted Answer

EDGAR (Electronic Data Gathering, Analysis, and Retrieval system) is a system created by the SEC to receive and store electronic filings of financial documents submitted by publicly traded companies. It helps the SEC to efficiently receive, accept, disseminate, and analyze time-sensitive data, thus increasing the efficiency and fairness of the securities markets. EDI (Electronic Data Interchange) is a broader term referring to the electronic exchange of business documents between companies, while ESEC and EMMA are not relevant to the SEC's primary purpose.

Question 4

Accountants are liable for any materially false or misleading information contained in the registration statement filed with the SEC up to:
A)the date the registration statement is filed.
B)the date of the audit report.
C)the effective date of the registration statement.
D)the date securities are sold.

Accepted Answer

Accountants are liable for any materially false or misleading information contained in the registration statement up to the effective date of the registration statement, which is the date the securities can be sold. This is because the purpose of the registration statement is to provide accurate and complete information to potential investors, and the accountant's audit report is included in the registration statement. It is important for the accountant to ensure the information is accurate since investors rely on this information to make informed investment decisions.

Question 5

Which of the following choices best describes correct use of the forms indicated?
A)Option A
B)Option B
C)Option C
D)Option D

Accepted Answer

Option A is correct because it correctly uses the forms indicated.

Question 6

Each of the following questions names an item. Select the correct description of the item from this list. Indicate your selection by entering the letter of the description.
Descriptions

-Form 10-K
A) Provides preliminary information to investors about an upcoming issue.
B) Informs investors of an upcoming offering.
C) Required annual filing to the SEC.
D) Discloses unscheduled material events.
E) Includes amendments to the Securities Act, additional disclosure requirements, and other current issues regarding accounting and auditing principles and standards.
F) Results in a thorough examination by the SEC of a registration statement.
G) Issued by the staff of the SEC and contains differences that must be corrected in a registration statement before the securities may be offered for sale.
H) Quarterly report to SEC.
I) Includes new or revised administrative practices and interpretations used in reviewing financial statements.
J) Includes the results of actions taken against accountants or other participants because false or misleading statements were filed.
K) Includes Regulations S-X and S-K.

Accepted Answer

Form 10-K is a comprehensive annual report filed by public companies to the SEC, detailing their financial performance.

Question 7

Each of the following questions names an item. Select the correct description of the item from this list. Indicate your selection by entering the letter of the description.
Descriptions

-"Red Herring" Prospectus
A) Provides preliminary information to investors about an upcoming issue.
B) Informs investors of an upcoming offering.
C) Required annual filing to the SEC.
D) Discloses unscheduled material events.
E) Includes amendments to the Securities Act, additional disclosure requirements, and other current issues regarding accounting and auditing principles and standards.
F) Results in a thorough examination by the SEC of a registration statement.
G) Issued by the staff of the SEC and contains differences that must be corrected in a registration statement before the securities may be offered for sale.
H) Quarterly report to SEC.
I) Includes new or revised administrative practices and interpretations used in reviewing financial statements.
J) Includes the results of actions taken against accountants or other participants because false or misleading statements were filed.
K) Includes Regulations S-X and S-K.

Accepted Answer

The answer of Each of the following questions names an...

Question 8

Proxy statements are:
A)filed by an entity that acquires a beneficial ownership of more than 5 percent in a company.
B)interim financial statements need not be audited.
C)materials submitted to shareholders for votes on corporate matters.
D)used to disclose unscheduled material events.

Accepted Answer

Proxy statements are materials submitted to shareholders for votes on corporate matters. They provide important information on matters such as executive compensation, board member elections, and shareholder proposals.

Question 9

Which of the following statements concerning the management discussion and analysis (MD&A)of a company's financial condition is true?
I.It should cover the financial statements and other statistical data for the most recent three-year time span.
II.It should make year-to-year comparisons of material changes in the line items.
III.Management need not explain the cause(s)of the material changes.
IV.Disclosure of material off-balance sheet transactions,arrangements,and obligations is required in each annual and each quarterly report.
A)I,II,and IV
B)II and III
C)I,III,and IV
D)I,II,III,and IV

Accepted Answer

I. It is true that the MD&A should cover the financial statements and other statistical data for the most recent three-year time span.
II. It is true that the MD&A should make year-to-year comparisons of material changes in line items.
III. It is false that management need not explain the cause(s) of the material changes. Management should explain the cause(s) of any material changes.
IV. It is true that disclosure of material off-balance sheet transactions, arrangements, and obligations is required in each annual and each quarterly report.

Question 10

Each of the following questions names an item.Select the correct description of the item from this list.Indicate your selection by entering the letter of the description.
Descriptions
a.Provides preliminary information to investors about an upcoming issue.
b.Informs investors of an upcoming offering.
c.Required annual filing to the SEC.
d.Discloses unscheduled material events.
e.Includes amendments to the Securities Act,additional disclosure requirements,and other current issues regarding accounting and auditing principles and standards.
f.Results in a thorough examination by the SEC of a registration statement.
g.Issued by the staff of the SEC and contains differences that must be corrected in a registration statement before the securities may be offered for sale.
h.Quarterly report to SEC.
i.Includes new or revised administrative practices and interpretations used in reviewing financial statements.
j.Includes the results of actions taken against accountants or other participants because false or misleading statements were filed.
k.Includes Regulations S-X and S-K.
-Customary Review

Accepted Answer

The answer of Each of the following questions names an...

Question 11

Which of the following is true about the Foreign Corrupt Practices Act of 1977 (FCPA)?
I.Publicly held companies should maintain an adequate system of internal control.
II.Individuals associated with U.S.companies are prohibited from bribing foreign officials for the purpose of securing a contract.
III.Compensating or agents' fees are disallowed under all circumstances.
A)I and II
B)II and II
C)I and III
D)I,II,and III

Accepted Answer

Choice A is correct because both statements I and II are true. Statement III is false because compensating or agents' fees are not disallowed under all circumstances, but they must be reasonable and not excessive.

Question 12

Schedule 13D is filed
A)by entities that acquire a beneficial ownership of more than 5 percent of a class of registered equity securities.
B)to broadly report material information that is being provided to securities analysts,selected institutional investors,or others.
C)to disclose material items related to asset-backed securities such as a bond issue.
D)by management to report the existence and effectiveness of the company's internal control over financial reporting.

Accepted Answer

Schedule 13D is filed by entities that acquire a beneficial ownership of more than 5 percent of a class of registered equity securities, as required by the Securities Exchange Act of 1934.

Question 13

Information concerning the unexpected resignation of one or more of the registrant's directors would be disclosed on which of the following forms?
I.Form 8-Q
II.Form 8-K
A)I
B)II
C)Both I and II
D)Neither I nor II

Accepted Answer

Information regarding unexpected resignation(s) of the registrant's director(s) is considered a "major event" and must be disclosed on Form 8-K within four business days. Form 8-Q is a quarterly report that does not require immediate disclosure of major events.

Question 14

Which of the following classes of information are included in the Form 10-K?
I.Management's discussion and analysis
II.Audited financial statements and footnotes
III.Auditor's opinion on the company's internal control system
A)I and II
B)I and III
C)II and III
D)I,II,and III

Accepted Answer

All three classes of information - Management's discussion and analysis, audited financial statements and footnotes, and auditor's opinion on the company's internal control system - are included in the Form 10-K.

Question 15

Pro forma disclosures are:
A)used to disclose unscheduled material events.
B)interim financial statements need not be audited.
C)materials submitted to shareholders for votes on corporate matters.
D)"what-if" presentations often taking the form of summarized financial statements.

Accepted Answer

Pro forma disclosures are "what-if" presentations often taking the form of summarized financial statements. They are used to show how certain events or transactions would have affected the company's financial statements had they occurred during the relevant period. Pro forma disclosures are not a requirement under generally accepted accounting principles (GAAP), but may be used to provide investors with additional information about the potential impact of certain events or transactions on a company's financial performance.

Question 16

Each of the following questions names an item. Select the correct description of the item from this list. Indicate your selection by entering the letter of the description.
Descriptions

-Comment Letter
A) Provides preliminary information to investors about an upcoming issue.
B) Informs investors of an upcoming offering.
C) Required annual filing to the SEC.
D) Discloses unscheduled material events.
E) Includes amendments to the Securities Act, additional disclosure requirements, and other current issues regarding accounting and auditing principles and standards.
F) Results in a thorough examination by the SEC of a registration statement.
G) Issued by the staff of the SEC and contains differences that must be corrected in a registration statement before the securities may be offered for sale.
H) Quarterly report to SEC.
I) Includes new or revised administrative practices and interpretations used in reviewing financial statements.
J) Includes the results of actions taken against accountants or other participants because false or misleading statements were filed.
K) Includes Regulations S-X and S-K.

Accepted Answer

The answer of  Each of the following questions names...

Question 17

Each of the following questions names an item. Select the correct description of the item from this list. Indicate your selection by entering the letter of the description.
Descriptions

-"Tombstone ad"
A) Provides preliminary information to investors about an upcoming issue.
B) Informs investors of an upcoming offering.
C) Required annual filing to the SEC.
D) Discloses unscheduled material events.
E) Includes amendments to the Securities Act, additional disclosure requirements, and other current issues regarding accounting and auditing principles and standards.
F) Results in a thorough examination by the SEC of a registration statement.
G) Issued by the staff of the SEC and contains differences that must be corrected in a registration statement before the securities may be offered for sale.
H) Quarterly report to SEC.
I) Includes new or revised administrative practices and interpretations used in reviewing financial statements.
J) Includes the results of actions taken against accountants or other participants because false or misleading statements were filed.
K) Includes Regulations S-X and S-K.

Accepted Answer

A "Tombstone ad" is an advertisement that informs investors of an upcoming offering of securities. It typically provides basic information about the offering, such as the type of securities being offered and the underwriters involved.

Question 18

What does an underwriter typically require from an accountant which indicates that the company has fulfilled all the accounting requirements in the registration process?
A)A comment letter
B)An audit opinion
C)A "red herring" prospectus
D)A comfort letter

Accepted Answer

An underwriter typically requires a comfort letter from an accountant which indicates that the company has fulfilled all the accounting requirements in the registration process. This letter provides limited assurance that the financial information is accurate and complete.

Question 19

According to the provisions of the Sarbanes-Oxley Act,
A)accounting firms can provide both audit and non-audit services to the same company.
B)the auditor should report directly to,and have its work overseen by,the company's management.
C)audit committees should be composed of non-management members of a company's board of directors.
D)both the lead audit partner and the audit review partner for publicly held companies should be rotated at least every two years.

Accepted Answer

The Sarbanes-Oxley Act states that audit committees of publicly held companies should be composed entirely of independent, non-management members of the company's board of directors. This is intended to ensure that the audit committee provides an objective, independent oversight of the company's financial reporting and audit process, without being influenced by management's interests or conflicts of interest. The other options are incorrect: A) Sarbanes-Oxley prohibits accounting firms from providing both audit and non-audit services to the same company. B) The auditor should report to the audit committee, not management, and the committee should oversee the auditor's work. D) The lead audit partner and the audit review partner for publicly held companies should be rotated every five years, not two.

Question 20

Which of the following statements concerning Form 10-Q is NOT true?
A)It is filed for all four quarters.
B)It is the quarterly report to the SEC.
C)It contains an update on significant matters occurring since the last quarter.
D)It includes comparative financial statements prepared in accordance with APB 28.

Accepted Answer

The answer of Which of the following statements concerning Form...

Quiz 14: Sec Reporting

Which of the following statements concerning pro forma disclosures is not true?

Which of the following is defined as directly or indirectly having the power to vote the shares or investment power to sell the security?

Which system helps the SEC accomplish its primary purpose of increasing the efficiency and fairness of the securities markets by expediting the receipt,acceptance,dissemination,and analysis of time-sensitive data filed with it?

Accountants are liable for any materially false or misleading information contained in the registration statement filed with the SEC up to:

Which of the following choices best describes correct use of the forms indicated?

Each of the following questions names an item. Select the correct description of the item from this list. Indicate your selection by entering the letter of the description. Descriptions -Form 10-K

Each of the following questions names an item. Select the correct description of the item from this list. Indicate your selection by entering the letter of the description. Descriptions -"Red Herring" Prospectus

Proxy statements are:

Schedule 13D is filed

Information concerning the unexpected resignation of one or more of the registrant's directors would be disclosed on which of the following forms? I.Form 8-Q II.Form 8-K

Which of the following classes of information are included in the Form 10-K? I.Management's discussion and analysis II.Audited financial statements and footnotes III.Auditor's opinion on the company's internal control system

Pro forma disclosures are:

Each of the following questions names an item. Select the correct description of the item from this list. Indicate your selection by entering the letter of the description. Descriptions -Comment Letter

Each of the following questions names an item. Select the correct description of the item from this list. Indicate your selection by entering the letter of the description. Descriptions -"Tombstone ad"

What does an underwriter typically require from an accountant which indicates that the company has fulfilled all the accounting requirements in the registration process?

According to the provisions of the Sarbanes-Oxley Act,

Which of the following statements concerning Form 10-Q is NOT true?