What is a prospectus?
a. A letter issued by the SEC authorizing a new issue of securities.
b. A report stating that the SEC recommends a new security to investors.
c. A letter issued by the SEC that outlines the changes required for a registration statement to be approved.
d. A document that describes the details of a proposed security offering along with relevant information about the issuer.
e. An advertisement in a financial newspaper that describes a security offering.
A registration statement is a collection of documents that a company files with the SEC at the time of a new equity issue. The goal of this statement is to provide information to the SEC and investors about the company and the new issue.
Answer and Explanation:
It is filed by the company, not the SEC.
The SEC does not make recommendations.
It is filed by the...
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from Accounting 101: Financial AccountingChapter 5 / Lesson 12