Accounting Disclosures\" Please respond to the following: Go to the SEC Website

Question

Accounting Disclosures" Please respond to the following:

Go to the SEC Website to review the information related to accounting disclosures. Next, choose one (1) of the three (3) disclosure reports required by the SEC for publicly-traded companies. From your choice of reports, analyze the major elements that companies must disclose. From your analysis, propose at least two (2) specific disclosures that the SEC requires, and predict a potential outcome to investors should companies fail to disclose this information. Justify your response

Explanation / Answer

Solution.

(1) Accounting disclorure : These disclorures that the SEC requires and predict a potential outcome to investors should companies fail to disclose this information given below

1. The expected impact of recentlay issued accounting standards should be disclosed, as discussed in SAB 74 Disclosure should be considered with respect to any newly issued accounting guidance that comprises GAAP as specified by SAS 69

2. Stock compensation acconting was modified by FIN 44, Reductions of an employee's stock option exercise price, either directly or indirectly, now subject the option to variable plan reporting from the date of the modification to the date of award, forfeiture or expiration.

3. Convertible securities issued within one year of an IPO with beneficial conversion terms compared to the IPO price are presumed to result in additional compensation or other expense to the extent of the difference between the IPO price and the conversion price.

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