Introduction The US Securities and Exchange Commission (SEC) is the US federal agency that holds the primary mandate to enforce federal securities laws and regulations to control the securities industry and the country’s stock exchange and regulation of all activities and organizations including the US electronic securities market. The SEC is committed to promoting a market environment that yields public trust characterized by integrity to attain its mission of protecting investors through maintenance of fair and efficient markets through facilitation of capital information (Basagne, 2010). The SEC financing is a major area of focus since there has been major concern regarding the SEC agency financing and whether they utilize the taxpayers’ money. This paper focuses on the Security and Exchanges Commission (SEC) budgeting and financing. The key point addressed is whether the SEC competes for funding with all other agencies for federal allocation or whether the agency has its own earmarked revenue which may lead to overspending by the entity with the protected source of funds. The SEC financing As it is set up, the SEC is a federal agency and obtains its capital from the Congress. The senate committee on appropriation is responsible for SEC budget allocation. SEC; common with other federal agencies benefits from the Treasury Appropriation Fund (Becker, 2012). Funding is for the agency is mainly from collection from the industry and other financial activities. Budget resources for the SEC include Funds from Dedicated Resources, the Reserved Fund, the Deposit Fund and the Miscellaneous Receipts Accounts. Funds from dedicated collections Most of the funds in budget spending for SEC through funds from dedicated collections. In this ca... ... middle of paper ... ... capital market, the SEC financing includes funds from dedicated collections, reserved fund, deposit fun and Miscellaneous Receipts Accounts. The agency’s financial statements are prepared in accordance with the general accepted accounting principles as per requirement for federal entities reporting requirement. The SEC does not actually compete for funding with all other uses of federal money or since it has its own earmarked revenues which may lead to overspending by the entity with the protected source of funds. To limit spending however, SEC reimburses excessive revenue to the Congress and does not spend without the authorization by the Congress and authorization for spending is controlled by the senate. Under its mission, SEC effectively protects the taxpayer and investors by maintaining fair, orderly and sustainable markets and facilitating capital formation.
Sarbanes-Oxley Act and Dodd-Frank Act are some of the most important regulations in the modern financial environment. The significance of these regulations is attributed to their focus on promoting the vitality of financial markets through addressing complexities in financial procedures and preventing financial wrongdoing. The enactment of these regulations was fueled by some financial irregularities in the corporate world and some major players in the financial markets. Despite the strong link between these laws and the financial markets, they have some similarities and differences in light of their respective objectives.
It has been a decade since the Sarbanes-Oxley Act became in effect. Obviously, the SOX Act which aimed at increasing the confidence in the US capital market really has had a profound influence on public companies and public accounting firms. However, after Enron scandal which triggered the issue of SOX Act, public company lawsuits due to fraud still emerged one after another. As such, the efficacy of the 11-year-old Act has continually been questioned by professionals and public. In addition, the controversy about the cost and benefit of Sarbanes-Oxley Act has never stopped.
...hile it is important that the administrator monitor the amount of money spent and the amount of money to be spent, he/she is not responsible for the overall account of the budget. Most schools employ a secretary to handle the accounting duties. This person writes the checks, makes deposits, and balances the general ledger. They are also responsible for providing paperwork when audited.
This statement only says that the power has been designated to Congress. It does not stipulate how to use this power nor does it give instructions for the budgeting process. Even as the role of government continued to expand, there was still no procedure for drafting and implementing a budget. It became clear that this lack of protocol hindered Congress’s ability to govern the budget. As a result, Congress forged its own budget process. Congress has passed many acts and amendments, but to no avail because the process still lacks a stable and lasting way of budgeting. Government budgeting has changed, in that, there is a formal process in place now, but it is no more effective than when there was none because the changes made by law were aimed more at gaining and/or reclaiming power and not real budgeting.
Summary of the Provisions of the Sarbanes-Oxley Act of 2002 (2004) AICPA. Retrieved November 9, 2013 http://www.aicpa.org/InterestAreas/ForensicAndValuation/Resources/FraudPreventionDetectionResponse/Pages/Summary%20of%20the%20Provisions%20of%20the%20Sarbanes-Oxley%20Act%20of%202002.aspx
The Federal Open Market Committee, consisting of the seven members of the Board of Governors and five members elected by the Federal Reserve banks, is responsible for the determination of Federal Reserve Bank policy in the purchase and sale of securities on the open market. The Federal Advisory Council, whose role is purely advisory, consists of 12 members if they meet membership qualifications.
Cy-Fair’s Business and Financial department develops the budget for school administrators. Once the budget summary has been developed the Principal then can decide within the budget how he would like to spend the money given by the district. Certain areas of the budget are to be spend on specific items, for example the budget for “GT/Horizon Supplies” can only be spend on GT instructional needs. On the other hand the budget for “Instructional Supplies” is more flexible. Primary example the after the Principal analyzes what are his campus needs, he then may decide on the materials he would like to spend the money on as long as it supports the needs of his campus. Although the principal is limited on how he
Benston, G.J. ‘Towards a Cost/Benefit analysis of the SEC: Have the British a Better Way?, Midland Corporate Finance Journal, 1985.
Perhaps the biggest takeaway from Chapter 2 for me was the staggering number of breaches, and the purely reactive method of legislation to deal with these events. It is unfortunate, but laws seem to be changed as a matter of reaction to incidents, rather than a proactive method of anticipating those incidents. For example, the Sarbanes-Oxley Act of 2002, which was in response to the widespread corporate corruption scandal of Enron. It seems that many of the points regarding transparency in accounting were common sense, and could have been implemented prior. However, in the cybersecurity and business world, I suppose it is hard to anticipate corruption before it happens.
Sarbanes-Oxley Act was enacted following a prolonged period of corporate scandals involving large public companies from 2000 to 2002, this was to restore investors confidence in markets and close loopholes for public companies to defraud investors. This act has had a profound effect on cooperate governance in the US, it requires public companies to strengthen audit committees, perform internal controls tests, set personal liability of directors and officers for accuracy of financial statements, and strengthen disclosure. The Sarbanes-Oxley
This week’s case study, Enron: Questionable Accounting Practices Bring New Regulation to the United States, reflects the increased government control regarding accounting and financial issues in corporations. This increased control was implemented due to the downward economic spiral occurring in the late 1990s. Although, Enron had successfully concealed their debt for years, they inevitably collapsed under an avalanche of debt and profit misrepresentation (Ferrell, Hirt, & Ferrell, 2009). Flawed principles and disclosures surfaced within accounting practices. Therefore, the government implemented the Sarbanes-Oxley Act. The Sarbanes-Oxley Act provided oversight to corporate financial reporting protocols, ethical employee standards, and financial
There are numerous regulatory agencies that are in charge of supervising the United States’ economy. First and foremost among these is the Federal Reserve. After the Panic of 1907 had occurred, the public was clamoring for a better regulated financial system. This resulted in the establishment of the Federal Reserve, which was poised to regulate banks and be a lender of last resort. It currently has the power to regulate federal banks, financial holding companies, securities holding companies, and thrifts. It can also regulate state banks that belong to the Federal Reserve System, foreign banks that have branches in the United States, and American banks with branches overseas. It can also regulate any company, institution,
To understand the purpose and role of the Federal Reserve System, we must first know the origin of the central bank of the United States. On December 23, 1913 President Woodrow Wilson signed The Federal Reserve Act. The primary purpose of the act was to make sure that a supply of money and credit would be available in the United States to meet banking demands by establishing Federal Reserve Banks which would hold the responsibility of supporting the credit structure during periods of financial strain. Other banks were expected to rely on the Federal Reserve for emergency cash and credit. Government and banking influence would select the management, primarily a board of directors chosen by banks. Supervision would be by the Federal Reserve Board. The intent in 1913 was to create eight to twelve centrally located district Federal Reserve Banks and national banks would be required to keep a part of their reserve with the Federal Reserve. The Federal Reserve would receive deposits from the government and receive deposits and lend to member banks only. It took almost a year to determine the boundaries of the decided twelve districts and establish the twelve Reserve Banks (one of the four components of the Federal Reserve). Named after the city in which they are located, the twelve Banks are Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco.
In 1934 the Securities Exchange Act created the SEC (Securities and Exchange Commission) in response to the stock market crash of 1929 and the Great Depression of the 1930s. It was created to protect U.S. investors against malpractice in securities and financial markets. The purpose of the SEC was and still is to carry out the mandates of the Securities Act of 1933: To protect investors and maintain the integrity of the securities market by amending the current laws, creating new laws and seeing to it that those laws are enforced.
The success of a company is very dependent upon its financial accounting. In accounting there are numerous Regulatory bodies that govern the accounting world. These companies are extremely important to a company because they set the standards when it comes to the language and decision making of a company. These regulatory bodies can be structured as agencies, associations, commissions, and boards. Without companies like the Security and Exchange Commission (SEC), The Financial Accounting Standards Board (FASB), the Governmental Accounting Standards Board (GASB), Internal Accounting Standards Board (IASB), Internal Revenue Service (IRS), and other regulatory bodies a company could not make well informed decisions. In this paper the author will look at only four of them.