The SEC and International Cash Management

Published date01 November 2015
Date01 November 2015
© 2015 Wiley Periodicals, Inc.
Published online in Wiley Online Library (
DOI 10.1002/jcaf.22096
The SEC and International Cash
Donald A. Walker Jr.
The SEC as an
agency is tasked with
assuring that inves-
tors are provided
with full, fair, and
adequate disclosure
about their invest-
ments. Generally, it
is not concerned so
much with corporate
actions as with the
timely disclosures
made to investors
about those actions.
Corporate disclosure
documents such as
the annual report on
Form 10‐K and the
quarterly report on
Form 10‐Q, and the
disclosures about
significant events
required on Form
8‐K, have both finan-
cial reporting require-
ments and qualitative
information require-
ments. Transaction‐ driven
documents such as proxy
statements and securities reg-
istration statements also have
both these financial reporting
requirements and qualitative
information requirements.
Part of the qualitative infor-
mation required is interpretive
narrative about the financial
information, explain-
ing the hows, whys,
and whens, but also
discussing the known
trends, demands
for resources, and
uncertainties that
may render currently
reported financial
results and financial
position not indica-
tive of future finan-
cial reports.
The financial
reporting require-
ments of the SEC
for U.S. corporations
are based on the
application of U.S.
generally accepted
accounting principles
(GAAP), the prom-
ulgation of which
is delegated to the
Financial Account-
ing Standards Board (FASB)
with oversight by the SEC. The
SEC looks to the requirements
of U.S. GAAP, which include
both application of principles
This article describes the impact of the Securi-
ties and Exchange Commission (SEC) disclosure
rules as they apply to U.S. corporations about
transactions with companies in nations that were
designated as state supporters of terrorism. The
rules require broader and more detailed disclosures
about executive compensation and the methods
for valuing complex financial instruments. Various
stakeholders want a deeper knowledge of manage-
ment activities in these regions of the world. Cash
balances held outside the United States by U.S. cor-
porations are seen as being withheld from invest-
ing in growth and taxation in the United States. A
most recent cause in the concern for increasing
employment and economic growth is the focus on
corporate cash balances held outside the United
States by U.S. corporations, which are seen both as
being withheld from investing in growth and provid-
ing jobs in the United States and not being taxed
by the United States. This article describes the
impact of the SEC disclosure rules as they apply to
U.S. corporations, but does not address the valid-
ity of these concerns or the morality of corporate
behavior. © 2015 Wiley Periodicals, Inc.

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