The Regulation of New

Public Issues of Corporate

Securities

PURPOSE?

 Protect the investing public by

providing investors with information
to help prevent fraud and the
manipulation of securities prices.
It is not the purpose of the regulation
to protect you from your own
mistakes

Major pieces of legislation

Securities Act of 1933

Securities Exchange
Act of 1934

covers new issues of

securities

devoted to trading in existing

securities

Securities and Exchange

Commission

10-K report
Has a substantial amount of factual
information
Sent to stockholders as the companys
annual report
The annual report on Form 10-K
provides a comprehensive overview of
the company's business and financial
condition and includes audited
financial statements.

Full disclosure
NOT to stifle the corporation BUT
Notify the investors so they can
make informed decision
Prevent the firms employees from
using privileged information from
personal gain

Sarbanes-Oxley Act of
2002

 Most recent security legislation

Fraudulent corporation activities,
misleading accounting practices, and
the resulting severe stock market
price declines reduced investor
confidence.

 By increasing corporate responsibility

and financial disclosure, creating
stronger firewalls between
investment bankers and securities
analysts, and increasing the
punishment for violations, SarbanesOxley is designed to help restore
investor confidence in the securities
markets.