Question

Which of the following is not required to be discussed in the Management Discussion and Analysis of the Financial Condition and Results of Operations?

1) Operations
2) Capital resources
3) Earnings projections
4) Liquidity

Answer 1

Earnings projections are not required to be discussed in the Management Discussion and Analysis of a company's financial reports, whereas operations, capital resources, and liquidity are typical subjects of this section.

Step-by-step explanation:

The Management Discussion and Analysis (MD&A) section of a company's financial reports is intended to provide an overview of the previous year's operations and financial results and discuss the company's financial condition. This section typically includes discussions on operations, capital resources, and liquidity. However, among the given options, earnings projections are not required to be discussed in the MD&A. The Securities and Exchange Commission (SEC) guidelines encourage management to provide forward-looking information in the MD&A, but they are not required to provide specific earnings projections.

Answer 2

The correct answer is 3) Earnings projections

Step-by-step explanation:

The subject of this question is the Management Discussion and Analysis (MD&A) section, which is an integral part of a company's annual report or quarterly filing. The MD&A is designed to provide shareholders and other interested parties with a narrative from management that gives context to the financial statements, discusses the company's financial condition, and analyzes the results of its operations.

Specifically, the MD&A should cover the company's operations, liquidity, and capital resources. It generally does not require companies to provide earnings projections, as this involves forward-looking statements which are not mandatory and can sometimes be speculative.