Advanced Financial Accounting
11th Edition
ISBN: 9780078025877
Author: Theodore E. Christensen, David M Cottrell, Cassy JH Budd Advanced Financial Accounting
Publisher: McGraw-Hill Education
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Question
Chapter 14, Problem 14.2.1E
To determine
Introduction: Securities Act of 1993 which is passed in 1993 for security exchange works with the motive to secure the investors so that they can get financial and other important information related to securities issued in public sale and also to have a check on activities like fraud, misrepresentation, etc.
To choose: The correct answer.
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Students have asked these similar questions
. The issuing of security goes through a number of processes. Once the SEC has
commented on the registration statement and a preliminary prospectus has been
distributed to interested investors, the investment bankers organize road shows and
undertake book building in the process.
Required: Explain the meaning and two (2) purposes of road shows as used in the
preamble above.
2921 0 2
1.In accordance with CFA standard V(B), in preparing a research report involving securities, the members and candidates must:A.present the basis characteristics(general principles of the investment of the investment process used-such as risk and return related issues)
B.Include all factors that are relevant including any significant limitations and risks associated with the investment and/or decision-making process.
C.All the options listed.
D.Provide regular updates to any important changes to the securities(prices, risks.etc)
2. In accordance with CFA standard VI(A), a member must:
A.Disclose all actual and perceived conflicts of interest when it is convenient to ensure no loss of income.
B.Use their professional judgement and disclose conflicts of interest if the monetary value exceeds 300.
C.Disclose all actual and perceived conflicts of interest before assisting the client or employer.
D.Use their professional judgement and only disclose actual conflicts of interest.
For hedge accounting to be used, U.S. GAAP requires that these criteria must be satisfied, except:
O a. The effectiveness of eliminating a specific market risk is documented.
O b. A description of the hedging strategy is provided.
O c. The derivative is designated as a hedging instrument.
O d. A net gain results from hedging a specific risk.
Chapter 14 Solutions
Advanced Financial Accounting
Ch. 14 - Prob. 14.1QCh. 14 - Prob. 14.2QCh. 14 - Prob. 14.3QCh. 14 - Prob. 14.4QCh. 14 - Prob. 14.5QCh. 14 - Prob. 14.6QCh. 14 - Prob. 14.7QCh. 14 - Prob. 14.8QCh. 14 - Prob. 14.9QCh. 14 - Prob. 14.10Q
Ch. 14 - What type of items that specially involve the...Ch. 14 - Prob. 14.12QCh. 14 - Prob. 14.13QCh. 14 - What types of information must be disclosed in the...Ch. 14 - Prob. 14.15QCh. 14 - Objectives of Securities Acts [CMA Adapted] During...Ch. 14 - Prob. 14.7CCh. 14 - Prob. 14.8CCh. 14 - Prob. 14.1.1ECh. 14 - Prob. 14.1.2ECh. 14 - Organization Structure and Regulatory Authority of...Ch. 14 - Prob. 14.1.4ECh. 14 - Prob. 14.1.5ECh. 14 - Prob. 14.1.6ECh. 14 - Prob. 14.2.1ECh. 14 - Prob. 14.2.2ECh. 14 - Prob. 14.2.3ECh. 14 - Prob. 14.3.1ECh. 14 - Prob. 14.3.2ECh. 14 - Prob. 14.3.3ECh. 14 - Prob. 14.3.4ECh. 14 - Prob. 14.3.5ECh. 14 - Prob. 14.3.6ECh. 14 - Prob. 14.3.7ECh. 14 - Prob. 14.4.1ECh. 14 - Prob. 14.4.2ECh. 14 - Prob. 14.4.3ECh. 14 - Prob. 14.4.4ECh. 14 - Prob. 14.6.1ECh. 14 - Prob. 14.6.2ECh. 14 - Prob. 14.6.3ECh. 14 - Prob. 14.6.4ECh. 14 - Prob. 14.6.5ECh. 14 - Prob. 14.6.6ECh. 14 - Prob. 14.6.7E
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Similar questions
- The issue of security througha number of processes .once the SEC has commented to interest on the registration statement and a preliminary prospectus has been distributed to interest invetors,the investment bankers organizeroad shows and undertake book building in the process. Required: Explain the meaning and two [2]purposes of road showa as used in the preamble above.arrow_forwardAccording to AC Topic 320, 'Investments - Debt and Equity Securities', all of the following changes in circumstances may cause an entity to change its intent to hold a certain security to maturity without calling into question its intent to hold other debt securities to maturity in the future, EXCEPT for: O a. Evidence of a significant deterioration in the issuer's creditworthiness O b. Changes in market interest rates and related changes in the security's prepayment risk Oc. A change in tax law that eliminates or reduces the tax-exempt status of interest on the debt security O d. A major business combination or major disposition that necessitates the sale or transfer of held-to-maturity securities to maintain the entity's existing interest rate risk position or credit risk policyarrow_forwardMC Qu. 41-05 Which of the following describes... Which of the following describes a prospectus? Multiple Choice A prospectus is an oral promise that assures the buyer of the veracity of the information in the registration statement. A prospectus an advertising tool that issuers distribute to potential investors. A prospectus is a document that describes the securities offered for sale and the SEC's approval of those securities. A prospectus is a collection of all of the company's financial documents. APR 27 A AW rave Xarrow_forward
- MC Qu. 41-19 Underwrites are investment banking... Underwrites are investment banking firms that do which of the following? Multiple Choice Underwriters resell securities before the prospectus has been filed with and approved by the SEC. Underwriters determine whether the stock is valid and may be offered for sale to the general public. Underwriters purchase securities from an issuing corporation with the intent to sell them to brokerage houses, which them sell them to the public. Underwriters buy bonds from the issuing corporation before the issuing corporation sells its securities to the general public. 27 m A 2 Second create at least three different recoarch que ravearrow_forwardA company is trying to determine whether a debt security should be classified as a trading security or an available-for-sale security. Does the Codification provide guidance on a specific time period that an investor intends to hold a security? Is there a defined cut-off for an intended holding period? Identify the relevant authoritative guidance. (Use the following ASC citation format: ASC 000-00-00-00. Make sure to include "ASC" in your citation.)arrow_forwardIn what ways do financial derivatives address specific risks and play a role in risk management? How does the CFA Institute: Code of Ethics and Standards of Professional Conduct apply to investments in this market?arrow_forward
- Investment banking firms offer to facilitate the sale of securities to the public in a variety of ways. Which of the following methods guarantees the corporation with a pre - determined price for the securities? OA. a commission basis OB. a competitive bid Oc. a best efforts basis D. an underwriting diarrow_forward1. how does marketl risk relate to the Washington Mutual case and how can it be mitigated 2. what control Strategy for Market Risk can be used in the Washinton Mutual case 3. what recommendations can Washinton Mutual use to assist with there market risk and interest rate riskarrow_forwardWhat are some SEC regulations regarding sales of new securities?arrow_forward
- 3arrow_forwardSecurities exchanges create efficient markets that do all of the following EXCEPT control the supply and demand for securities through price. allocate funds to the most productive uses. allow the price to be determined by supply and demand of securities. ensure a market in which the price reflects the true value of the security.arrow_forwardWith respect to derivative instruments that are designated as hedges, the FASB calls for which of the following general disclosures? a. The objective of using hedging instruments. b. Description of the various types of hedges. c. A description of the types of transactions that are hedged d. All of the above.arrow_forward
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