Thought Leadership  •  April 05, 2021

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What Is A 10-K Filing?

What is a 10-K form? Every publicly traded company is required to file financial reports with the Securities and Exchange Commission, or the SEC. The Form 10-K offers a comprehensive snapshot of the company's financial health throughout the year, almost like an annual report for the business numbers. Dive deep into 10-K filing with the SEC, including what kind of information is reported, who needs to file, and how to file quickly and securely.

What Is a 10-K Report?

A Form 10-K discloses all the important business information that investors want to know about companies that are traded on the stock exchange. Information typically found in a 10-K includes:

  • Business history and current operations
  • Plans and programs
  • Business revenue
  • Managerial and executive level changes
  • Business threats and opportunities
  • Company debt and assets
  • Business balance sheet
  • Business income statement
  • Subsidiaries

This form needs to be filed within 60-90 days of the end of a company's fiscal year, which may or may not overlap with the end of the calendar year. The 10-K is made available online,  through the SEC database and on a company’s website. This allows investors, analysts, shareholders and other curious individuals to check the health of a company at any time.

How do you file a 10-K?

So, how is the information filed with the SEC? Electronically is the short answer.
The SEC uses what is commonly known as EDGAR to accept, manage and store companies' required reporting. EDGAR is searchable by anyone wishing to view corporate reporting. To deliver documents to the SEC thus requires secure software that is able to transmit documents to EDGAR's system while encrypting data for confidentiality. These days, most companies use cloud-based software so employees can generate and deliver reports from anywhere.

Who Must File and Why?

The 10-K form is important for regulatory reasons, as it offers a way to compare one company with a competitor using the same set of metrics. Since companies are legally bound to file a 10-K and other forms, those who skip this obligation can be held accountable through fines or fees.There are ethical considerations, too. In the wake of the dot-com bust, the SEC started requiring that company CEOs and CFOs sign off on the data, essentially swearing that the financial data is accurate.

A business auditor also includes a letter to accompany the 10-K. In his or her letter, the auditor describes the scope of auditing work that was done, and any errors or omissions discovered during the audit process. If the auditor is concerned about the company's financial wellbeing, he or she will make a veiled note of this in the letter, perhaps by highlighting  a concern about the company's ability to continue. This sort of "alarm bell" can signal to investors that they may want to sell shares or notify a competitor of an upcoming opportunity to acquire a struggling peer.

The form is also important for investment purposes. Prudent investors and would-be investors should study the 10-K carefully. With a thorough understanding of business operation, finances, risks and opportunities, investors can decide whether to support the business by buying shares. Given that a business wants its stock valuation to increase, attracting new investors is key to its success and profitability.

While the 10-K is important for investors, regulators, competitors and shareholders, it can also benefit the business that must prepare it. The 10-K is essentially a guided tour through the business's health, strategic opportunities and liabilities. While some companies may be intimately familiar with their financial landscape, others operate more on instinct and are less certain of the numbers. For these companies, the 10-K can serve as a financial checkup as well as a weathervane, helping the business's stakeholders see the best path forward with transparency

How to Handle Financial Reporting Requirements

The 10-K is just one of the many forms that must be filed with the SEC. This means that the average publicly traded company not only has to deliver a comprehensive financial report every year, but must also meet a range of other financial reporting requirements. DFIN is here to help your company handle all of its filing requirements, including filing Form 10-K. We are pleased to offer secure, cloud-based software that our clients rely on to file on-time, every time: ActiveDisclosure.

ActiveDisclosure promotes collaboration to streamline the complicated filing process. Built-in validation and health checks ensure no information is missing, while iXBRL tagging features support compliance with SEC regulations. When it's time to transmit, our premier fraud detection, security, encryption and data privacy features provide total protection.

Need a purpose-built tool for financial reporting and SEC filing? Look to DFIN for the support you need to make your next SEC filing easy.