Our Banks Disclosure notice:
Federal government-mandated disclosure came into being in the U.S. with the passage of the Securities Act of 1933 and the Securities Exchange Act of 1934. Both laws were responses to the stock market crash of 1929 and the Great Depression that followed.
The public and politicians alike blamed a lack of transparency in corporate operations for intensifying if not outright causing the financial crisis.
Sarbanes-Oxley
- Since then, additional legislation such as the Sarbanes-Oxley Act of 2002 extended public-company disclosure requirements and government oversight of them.
- As mandated by the SEC, disclosures include those related to a company's financial condition, operating results, and management compensation.
Insider Information
- The SEC requires specific disclosures because the selective release of information places individual shareholders at a disadvantage. For example, insiders can use material nonpublic information for personal gain at the expense of the general investing public. Clearly outlined disclosure requirements ensure companies adequately disseminate information so that all investors are on an even playing field.
- Companies are not the only entities subject to strict disclosure regulations. Brokerage firms, investment managers, and analysts must also disclose any information that might influence and affect investors. To limit conflict-of-interest issues, analysts and money managers must disclose any equities they personally own.
SEC-Required Disclosure Documents
The SEC requires all publicly-traded companies to prepare and issue two disclosure-related annual reports, one for the SEC itself and one for the company's shareholders. These reports are filed as documents called 10-Ks and must be updated by the company as events change substantially.
*The above text is from investopedia.com
