Securities and Exchange Commission

SEC The U.S. federal agency responsible for overseeing and regulating security markets and corporate financial reporting. Established in 1934, following the Securities Act of 1933 and the Securities Exchange Act of 1934, the SEC has quasi-judicial powers of enforcement that it uses in hundreds of civil cases every year. The SEC Web site states that its primary mission is "to protect investors and maintain the integrity of the securities markets" and that it "requires public companies to disclose meaningful financial and other information to the public, which provides a common pool of knowledge for all investors to use to judge for themselves if a company’s securities are a good investment." The SEC works closely with organizations like the U.S. stock exchanges and the *Financial Accounting Standards Board (FASB). The SEC endorses the FASB’s accounting standards, although it has reserved the right to intervene in the FASB’s standards-setting procedure (Nobes and Parker, 2002,168-169). The SEC’s interpretations of FASB standards are contained in * Staff Accounting Bulletins, which are considered to be part of U.S. *Generally Accepted Accounting Principles. In 2002 the *Sarbanes-Oxley Act set important new criteria for securities regulation and *corporate governance, and the SEC was charged with introducing many aspects of the new reforms. This included the creation of the *Public Company Accounting Oversight Board. Web site: www.sec.gov