Final answer:
The form 10-K is a comprehensive annual report filed with the SEC by publicly traded companies, containing audited financial statements and other vital information about the company's financial performance and business. It is required for maintaining transparency and protecting investors in the financial markets.
Step-by-step explanation:
A form 10-K refers to a firm's audited financial statements, sent to the Securities and Exchange Commission (SEC). This comprehensive document provides detailed information about a publicly-traded company's financial performance and includes annual income statements, balance sheets, cash flow statements, and a management discussion and analysis section.
Required by law, the 10-K offers investors a thorough understanding of a company's financial health and business model.
The form 10-K is one aspect of the broader regulatory framework designed to ensure transparency and fair practices within financial markets.
On May 27, the Federal Securities Act established legal standards for the disclosure of information pertaining to publicly traded securities. This act, along with other legislation, led to the establishment of the Securities and Exchange Commission, which oversees and regulates the investment industry.
While forms such as the 1040 relate to personal or firm tax responsibilities and are instrumental in fiscal policy, the 10-K is specifically for companies publicly traded on stock exchanges. It is part of the SEC's mandate to protect investors and maintain orderly and efficient markets.