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A 10-K is an annual report in a standardized form. For all publicly traded U.S. companies, the Securities and Exchange Commission (SEC) requires the filing of this report. In contrast to a traditional annual report, a 10-K contains a greater amount of information. The purpose of the report is to provide investors with a more comprehensive understanding of a company. A 10-K report can be extremely complex due to the volume of information it contains, as well as its nature. SEC regulations strictly govern the form. The 10-K provides the information in a much more straightforward manner than, for example, a non-standardized corporate annual report. Nevertheless, the report is a very valuable document for investors to obtain comprehensive information about a company. When analyzing the report, it may be useful to engage a specialist, such as an independent wealth manager.
The information documented in the 10-K includes, for example:
Thus, the 10-K provides an overview of all of a company's activities and risks. Since 10-K reports are public information, they can be easily accessed by the general public. The "Investor Relations" section of company websites often contains these documents. The SEC's EDGAR database also contains all 10-K reports.
Companies are also required to file
Form 10-Q during the first three quarters. Q stands for quarter. Following the final quarter, a 10-K is filed. In the event of a
bankruptcy, divestiture, or acquisition, an 8-K form must be filed. As a result,
8-Ks are not filed on a regular basis, but rather only in exceptional circumstances.
By default, a 10-K comprises four parts and 15 subject areas. In general, a 10-K contains the following important items:
A 10-K report must contain accurate information, which must also be verified and signed in writing by the company's chief executive officer (CEO) and chief financial officer (CFO). After the dot-com bankruptcy, several cases of accounting fraud led to the requirement for signatures. If there is a violation, both the CEO and CFO can be held responsible.
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