WallStreetMojo

WallStreetMojo

WallStreetMojo

MENUMENU
  • Free Tutorials
  • Certification Courses
  • 250+ Courses All In One Bundle
  • Login
Home » Investment Banking Tutorials » Equity Research Tutorials » Form 10-K

Form 10-K

Form 10-K Definition

Form 10-K is filed in the United States of America by publicly traded companies with a detailed statement of the company’s annual financial performance which is a necessary form to be filed with the securities exchange commission (SEC) within 60 days of the fiscal year-end.

This Form is prepared much more in detail than the company’s annual report, which is generally treated as a bible for the investors and other third parties. It is only applicable to the companies which are listed on the various stock exchange indexes of the United States of America.

Form 10K

Top 5 Information to Look for in Form 10-K SEC Filing

The objective of this filing is to provide the shareholders with accurate information and relevant information about the company so they can make successful investment decisions. Below are the top 5 most important sections in Form 10-K

#1 – Business

Form-10K-Business

This section discusses the core business of the company, how it makes money, where does it operate, and the overall vision and mission statement of the company. This section is vital, especially for new analysts/investors who want to learn more about the company.

Popular Course in this category
Sale
All in One Financial Analyst Bundle (250+ Courses, 40+ Projects)
4.9 (1,067 ratings)
250+ Courses | 40+ Projects | 1000+ Hours | Full Lifetime Access | Certificate of Completion
View Course

#2 – Risk factors and Business Overview

Form-10K-Risk-Factors

Companies are also required to disclose the various systematic and unsystematic risk factors that affect the business. The company discloses the potential threats that it is opposed to and the competition it is facing. Also, the company provides an overview of the business and the new acquisitions it has made.

#3 – Financial Statements and Footnotes

Financial-Statements

This section includes the audited company’s financial statements and its performance compared with the previous quarter or the same quarter of the last year. The audit financial statements include a balance sheet, income statements, statement of cash flow, and statement of other comprehensive income. The section also consists of the footnotes to support the three main accounts.

#4 – Management Discussion and Analysis

MDA

This MD&A section tells the story of the company present financial performance, future plans, and vision. Also, it provides a comparison of its results against the past quarter or the past period. The section also contains words from the board of the company and their vision of how the company is going to perform in future

#5 – Audit Opinion

Form-10K-Audit-Opinion

In this section, the critical details of the auditor’s opinion (Qualified or Unqualified Opinion) regarding the financial statements. It also confirms if they were prepared as per the accounting policies and guidelines.

Advantages

Form 10-K has the following advantages: –

  • Form 10-K is a source of information about the company for the shareholders and the investors, which makes it a document for investment decision
  • Form 10-K contains vital information about the company, and it also tells the analyst the future plans and the strategic initiatives which the company is going to take in the future
  • Form 10-K is also used for valuation purposes and also for financial projections of the company

Disadvantages

Form 10-K has the following disadvantages: –

  • Because of the requirement and the filing criteria, Form 10-K tend to be very long and complicated in nature, but investors need to understand that this is the most comprehensive public document which is available in the public domain
  • Public information also has a disadvantage, and the threat of takeover from the public shareholder as the company discloses the public shareholding of every director also the compensation of the senior executive director is also disclosed
  • The form 10-K needs to be filled quarterly and has their compliance and cost to be filled, and the form is usually unaudited, so it does not prove to be a good source of investment decision

Conclusion

Typically, a company needs to file both annual reports and Form 10-K in a single pager document with the annual report starting from the overview of the company’s financial statements. A good analyst should read and analyze both the document in-depth and make his investment decisions in the light of the same. An analyst should carefully analyze the risk factors which are both within and outside the business environment to understand the business correctly.

Recommended Articles

This article has been a Guide to Form 10-K Edgar Filing and its definition. Here we the top 5 company information to look for in Form 10-K (business, risk, financials, audit opinion, MD&A) along with examples, benefits, and disadvantages. You may learn more about Investment banking from the following articles –

  • Form 10-Q Meaning
  • Accounting Controls
  • Interim Reporting
  • Financial Reporting Meaning
0 Shares
Share
Tweet
Share
Primary Sidebar
Footer
COMPANY
About
Reviews
Contact
Privacy
Terms of Service
RESOURCES
Blog
Free Courses
Free Tutorials
Investment Banking Tutorials
Financial Modeling Tutorials
Excel Tutorials
Accounting Tutorials
Financial Statement Analysis
COURSES
All Courses
Financial Analyst All in One Course
Investment Banking Course
Financial Modeling Course
Private Equity Course
Venture Capital Course
Excel All in One Course

Copyright © 2021. CFA Institute Does Not Endorse, Promote, Or Warrant The Accuracy Or Quality Of WallStreetMojo. CFA® And Chartered Financial Analyst® Are Registered Trademarks Owned By CFA Institute.
Return to top

WallStreetMojo

Free Investment Banking Course

IB Excel Templates, Accounting, Valuation, Financial Modeling, Video Tutorials

* Please provide your correct email id. Login details for this Free course will be emailed to you

Book Your One Instructor : One Learner Free Class
WallStreetMojo

Free Investment Banking Course

IB Excel Templates, Accounting, Valuation, Financial Modeling, Video Tutorials

* Please provide your correct email id. Login details for this Free course will be emailed to you

Let’s Get Started
Please select the batch
Saturday - Sunday 9 am IST to 5 pm IST
Saturday - Sunday 9 am IST to 5 pm IST

This website or its third-party tools use cookies, which are necessary to its functioning and required to achieve the purposes illustrated in the cookie policy. By closing this banner, scrolling this page, clicking a link or continuing to browse otherwise, you agree to our Privacy Policy

Login

Forgot Password?

New Year Offer - All in One Financial Analyst Bundle (250+ Courses, 40+ Projects) View More