Companies whose stock is traded on public stock exchanges in the United States are required to file certain reports with the federal Securities and Exchange Commission (SEC) disclosing information that would be material to investment decisions. In addition to the SEC requirements, the Financial Accounting Standards Board of the Financial Accounting Foundation (FASB) has established standards for disclosing contingent losses. Regulated entities who fail to make the required disclosures or fail to make amendments to prevent prior disclosures from becoming misleading can be subject to civil or criminal enforcement actions. Moreover, shareholders and investors may bring private actions against registrants for losses caused by misleading statements or omissions of material information.
