Which of the following is correct about the steps a ﬁrm takes in issuing securities to the public?

Question

Quizplus · Accepted Answer

In order to issue securities to the public, management must file a preliminary prospectus with the appropriate regulatory body, such as the OSC in Canada, and provide it to potential investors. The prospectus provides information about the company and the securities being offered. The company cannot begin selling shares until the regulatory body approves the proposal and a final prospectus is issued. A red herring is a preliminary version of the prospectus that does not contain the final selling price of the securities. A final prospectus must be delivered to purchasers before the sale is finalized. Therefore, choices A, C, D, and E are incorrect.

Which of the Following Is Correct About the Steps a ﬁRm