Historical frame
- Kind
- organization
- Period
- Established 1934
- Jurisdiction
- United States
The commission administers reporting and market requirements while companies remain responsible for their own financial statements.
Questions to carry forward
- How does a regulator's work differ from an accountant's or auditor's work?
- Why can a private standard setter and a government regulator both affect a company's reporting?
Claim disciplineEvidence boundaries
- The SEC does not prepare issuer financial statements or audit them.
- Its jurisdiction and current rules must be determined from law and authoritative releases, not this history entry.
The Securities and Exchange Commission (SEC) administers and enforces federal securities laws within its authority. Congress created it in 1934. Its mission includes protecting investors, maintaining fair, orderly, and efficient markets, and facilitating capital formation, meaning raising funds for businesses.
The SEC recognizes the Financial Accounting Standards Board's accounting standards for nongovernmental US reporting while retaining its own legal authority. Companies subject to SEC reporting requirements must consider those requirements as well as applicable accounting standards.
The SEC does not prepare or audit a company's financial statements. Management prepares the reports; independent auditors examine them under applicable auditing requirements. Regulatory oversight does not remove either party's responsibility.