Final answer:
A firm must ensure legal and regulatory compliance before selling securities.
Step-by-step explanation:
When a firm decides to sell securities, it must first ensure that it follows the necessary legal and regulatory requirements. This includes obtaining the appropriate approvals and licenses from regulatory authorities such as the Securities and Exchange Commission (SEC) in the United States.
The firm may also need to prepare a prospectus or other offering documents that provide detailed information about the securities being sold and the risks associated with investing in them.