SEC Requires Analysts to Certify Reports | AccountingWEB

SEC Requires Analysts to Certify Reports

Stock analysts will now have to certify the truthfulness of their research reports, under a recent unanimous ruling by federal regulators.

On January 6, the Securities and Exchange Commission (SEC) ruled that analysts must certify that the research in their reports and public comments represent their true view. In addition, analysts must certify that haven’t received any payment from the company they are assessing. If they were paid for the report, they must disclose the amount they received and state that the compensation could influence their opinion.

The new SEC rule is intended to end misconduct in the brokerage industry. The measure comes on the heels of recent allegations that some analysts publicly pushed stock that they personally scorned in an effort to help their brokerage firms retain profitable investment banking business. In December 2002, all the major Wall Street firms agreed to a $1.4 billion settlement after an investigation into conflict-of-interest charges by New York attorney general Eliot Spitzer.

The rule requiring analysts to certify their reports is similar to recent SEC regulations for senior-level corporate executives and mutual fund officers.

Wait, there's more!
There's always more at AccountingWEB. We're an active community of financial professionals and journalists who strive to bring you valuable content every day. If you'd like, let us know your interests and we'll send you a few articles every week either in taxation, practice excellence, or just our most popular stories from that week. It's free to sign up and to be a part of our community.
Premium content is currently locked

Editor's Choice

WHAT KIND OF FIRM ARE YOU?
As part of our continued effort to provide valuable resources and insight to our subscribers, we're conducting this brief survey to learn more about your personal experiences in the accounting profession. We will be giving away five $50 Amazon gift cards, and a $250 Amazon gift card to one lucky participant.
This is strictly for internal use and data will not be sold
or shared with any third parties.