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WHAT YOU SHOULD KNOW
- A 10-K is an annual report required for public companies in the US and submitted to the SEC.
- It contains detailed information about the company’s financial performance, organization, and executives.
- Investors can use 10-K to make informed decisions about buying or selling company shares or investing in bonds.
What Is a 10-K?
A 10-K is an annual report that publicly-traded companies in the United States must submit to the Securities and Exchange Commission (SEC). It contains detailed information about the company’s financial performance.
The report in question is more comprehensive than a company’s annual report, which is distributed to its shareholders before an annual meeting to elect company directors.1
A company must provide certain data in their 10-K filing, such as their background, organization, financial reports, earnings per share, subsidiaries, executive compensation, and other pertinent information.2
The U.S. Securities and Exchange Commission (SEC) requires companies to provide investors with a financial report to ensure they have the necessary information to make informed decisions about buying or selling company shares or investing in its corporate bonds.
10-Ks are often lengthy and complex due to the comprehensive and intricate details they contain.
Investors should be aware that the annual report is one of the most comprehensive and significant documents a public company can issue.
By analyzing a company’s 10-K, investors can gain a better understanding of the company’s operations and financials. Gathering as much information as possible from the 10-K can help investors make more informed decisions.
The government mandates companies to issue 10-K forms, providing investors with essential data about the company that can be used to make prudent investment choices.
Investors who are knowledgeable about the stock market know that 10-Ks can be accessed through the SEC’s EDGAR database using the company search function.3
The 10-K report is composed of five parts: Section I, Section II, Section III, Section IV, and Section V. Each section provides essential information about a company’s financial condition and performance.
The 10-K filing requires signed letters from the company’s top two executives, the chief executive officer, and chief financial officer.
In order to ensure the accuracy of the information included in the 10-K, executives must swear under oath that the data is true. This requirement was implemented following several accounting fraud cases that occurred after the dot-com bust.
Where to Find a 10-K
Calculate the present value of a hypothetical investment to determine its current worth.
Notably, 10-K filings can be easily accessed from various sources since they are public documents.
It is a commonplace for most businesses to feature their Investor Relations information on their website.
Filing Deadlines for a 10-K
The Securities and Exchange Commission (SEC) requires that companies with a public float of $700 million or more must submit their 10-K report within 60 days of the close of their fiscal year. A public float is the shares issued to the public that are available to trade.
Companies with a float of between $75 million and $700 million have 75 days to complete their financial reporting, while those with a float of less than $75 million have 90 days for the same purpose.
10-Q and 8-K Forms
Public companies must regularly adhere to SEC regulations and submit 10-K, 10-Q, and 8-K forms. They must submit Form 10-Q to the SEC every quarter.
This report provides an in-depth overview of a company’s financial performance, including key details about its financial position.
The 10-Q report differs from the 10-K in that the data it contains is typically not audited. The company must submit its 10-K report only three times a year, with the fourth quarter being the time for filing.
According to the U.S. Securities and Exchange Commission (SEC), companies must file a Form 8-K when they have major events to disclose to shareholders. This ensures that shareholders are kept up-to-date on any changes that may affect the company.
Events related to a company’s status or control, such as sales, acquisitions, delistings, departures, executives’ elections, and bankruptcies, can provide insight into a company’s operations, assets, and other news. Additionally, any further changes or relevant information should be taken into consideration.