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Investment

Investment

What is an Investment?
As a term, investment holds many different meanings in finance and business. With regards to finance, an investment is any asset or instrument that an investor purchases or sells with the expectation of earning a monetary profit. Financial investments, upon analysis, are attached with a high degree of security for the principal amount (the total amount invested), as well as a security of return within an expected period of time. The practice of thorough analysis is a necessary component of financial investing—all investors must practice prudence when investing. 
Investing is related to deferring consumption or saving. In business, investment occurs when a producer purchases a physical or working good, such as inventory or equipment, in the hope of improving future sales. This behavior is distinct from financial investing; business investing uses money to purchase a good that is re-sold at a higher price in the future, while financial investing uses money to purchase an abstract right or proof of ownership in the hopes of making more money. Common examples of financial investments include the purchase of stocks, bonds or options. 
As an investor, your main considerations—besides choosing which investment types are right for you—are found in the areas of taxes, inflation, asset allocation and risk management. It is always desirable to maintain a diversified portfolio. If you are overly exposed to one asset class or to a particular industry you will be susceptible to tremendous losses. 
Investment Advice for Beginners:
Types of Investments:
For first time investors, it is essential to understand the basics. Before you go out and throw your money around you should research the different types of investment. Stocks, bonds, mutual funds, property, currency and options are all popular forms of investment that individuals procure to generate profits. That being said, like all forms of investment, each vehicle is attached with risk and variables that influence your rate of return. 
The three basic asset categories concerning investments are as follows: cash, bonds and stocks.
Cash: The primary advantage of cash is that funds are liquid. Cash equivalents will also allow investors to secure interest or dividends. Forms of cash investments include Certificates of Deposit (CDs) and Treasury bills. 
Bonds: These types of debt instruments are issued by government agencies or corporations to finance certain aspects of their operation. When you invest in a bond, you are lending money to the issuer, entitling to secure interest on the loan and a guarantee that your principal (original amount lent) will be repaid when the bond matures. Bonds come in a variety of forms, including municipal bonds (issued by towns or districts), corporate bonds (issued by companies) or treasury bonds (issued by the federal government). Bonds, because of their relative safeness, are attached with fixed rates of return that are considerably less than the potential profit offered by stocks or other investment strategies. That being said, the rate of return for a bond investment is typically higher than certificates of deposits or savings accounts. 
Stocks: Shares of stock represent ownership in a corporation. Investment advice for beginners will state that investing in stocks should not be taken lightly—due diligence is necessary to secure a solid portfolio. Stocks will fall under multiple categories depending on the prospect of the company, the size,  and the state of the markets. Categories for stocks include: value stocks (high potential for growth), growth stocks and large, mid, and small-capitalization stocks (these categories relate to the size of the company). 
The Nature of Stocks:
Over the long run, stocks have historically outperformed all other investment types. Investment advice will dictate that investing in the S&P 500, over the long haul, is the safest and most profitable return on investment (average of 9.8% from 1926 to 2010). The next best performing asset class would be bonds: long-term U.S. treasury bonds return 5.4% on average over the same timeframe. 
The biggest determiner of stock price—and your rate of return—is earnings. Over the short-run, stock prices fluctuated based on a number of factors (from interest rates to investor confidence), however, over the long-run, what matters most are earnings. 
Although stocks may seem like the best investment strategy, over the short term they are particularly risky. Stocks are highly elastic not only to the underlying company of which the stock represents, but also, to the macro-economy. Dips in company earnings or negative macro outlooks could plummet holdings. Given the frailty of the domestic and global markets, investing in stocks is currently risky—in 2009, stocks overall lost almost 40%. However, with risk comes reward. Although the stock market is far riskier than other fixed-income investments–that typically guarantee a percentage rate of return–investing in stocks will yield higher profits if the stocks perform well. 
The biggest determiner of stock price—and your rate of return—are earnings. Over the short-run, stock prices fluctuated based on a number of factors (from interest rates to investor confidence), however, over the long-run, what matters most are earnings. 
As stated above, stocks are far riskier investment types than bonds or other fixed-income assets. A bad year for bonds would be a minimal hit to the stock market. For example, in 1994, the worst year for bonds in recent history, Treasury securities fell only 1.8%.
Assessing Risk: 
Risk refers to the possibility that you may lose all or all of your investment. Several factors should influence your willingness to take on risk, including your age, financial situation, financial goals and your time horizon. Before you dive-in to the markets, investing for beginners will state that you must first determine your risk tolerance. To do this, evaluate the following questions:
• Are you willing to tolerate greater volatility for the chance of securing higher returns?
• Do you place a greater emphasis on quality, with diminished risk?
Inflation and Taxes:
Inflation and taxes are two important considerations that must always stay on the mind of investors. Inflation is the perpetual increase in the cost of goods and services. For your income to grow in “real terms” your investments must outpace the rate of inflation. Moreover, solid investment advice will always consider the effect of taxation. There are an assortment of investment vehicles  that provide tax benefits; these investments are typically tax-free, tax-deferred or tax-deductible.  

Financial Literacy

Financial Literacy

What is Financial Literacy?
Financial literacy is the knowledge and understanding of financial products and money that individuals can apply to a variety financial decisions in order to make more informed decisions about how exactly to handle their personal finances. Ultimately, the purpose of financial literacy is provide individuals with the knowledge of financial principles needed to make a well-informed financial decision and to utilize financial products that positively impact one’s financial well-being. 
Many individual countries understand the necessity and importance of their citizens understanding financial literacy and created various task forces to examine their populations with the intention of providing financial literacy outreach and education. A common environment to see financial education literacy is in high schools, where students can be offered the chance to attend some brief courses that can prepare them to properly manage their finances after completing school.
Financial literacy includes a variety of different areas of understanding. Becoming educated about money and exactly how it works is a vital aspect, as is having a good understanding of financial products such as loans, insurance, or credit. It is also important to understand other financial or money issues, such as credit issues, going into debt, paying off debt, tracking money, budgeting, avoiding banking fees, getting lower interest rates, buying insurance, planning for retirement and so on.
Financial literacy aims to discuss a few key topics that can help secure financial security throughout a lifetime.
• Understand key financial products that one may need throughout a life, such bank accounts, retirement savings plans, mortgages and fundamental investments such as mutual funds, bonds, and stocks. 
• Understand basic financial concepts such as investment return, risk, compound interest, diversification, etc.
• Discuss financial and money issues that are usually left unspoken
• Make good financial decisions about spending, saving, and managing debt during key moments such as receiving an education, getting a new a job, purchasing a house, beginning a family, or preparing for retirement 
• Accommodate to changes that affect financial well-being in a prepared and competent matter such as changes in the general economy like rising unemployment, collapsing financial markets, or threat rapid inflation 

How to Improve Your Financial Literacy
While it is impossible to suddenly become extremely financially literate overnight, it is important to be patient and continue educating yourself on financial literacy. Resources such as books, newspapers, and magazines can be used to gain more information about money and finance. But just reading alone is not enough to drastically improve your financial literacy. It is important to make changes, to your financial lifestyle. Trying to live more frugally, planning a budget, saving for emergencies, carefully taking out loans, or knowing your credit score are some small ways to be more financially literate.
There are also man differential financial planning and investing classes offered locally which are designed to improve your financial literacy. If a class is not possible, a good alternative is to simply ask someone questions if they are very financially literate. This can be done in person, or through various online means, such as online forms or discussions.

GDP

GDP

What is GDP?
Gross Domestic Product, or GDP, is the market value of all final services and goods that are produced within a country in a specific period. The GDP looks the market value to arrive at a value which is then used to examine the growth rate of the economy as well as the overall economic health of the country being looked at. As a measure of the economy, the GDP can be a very useful way to measure the economy.
GDP can be measured using three different techniques. Theoretically, all three of these techniques should result in the same number. 
Income measure: The total value or amount of income that is mostly generated in terms of wages and profits.
Output measure: The total value of the services and goods produced by all different sectors of the economy such as construction, agriculture, service sector, government, manufacturing, and energy.
Expenditure measure: The value of the services and goods purchased by government, households, buildings, and investment in machinery as well as the value of exports subtracted by the imports
When a GDP of a country is calculated, the value includes all government and private spending, services and goods produced, as well as exports. The GDP is then adjusted for inflation and imports to arrive at a value which is believed to reflect the total sum of the country’s services and goods accurately. The GDP may be shown as a bulk number, but it is typically converted into a value representing GDP per capita, which creates a number that reflects the average per citizen. A high value for per capita GDP is associated with the country having overall improvements in the standards of living.
One major advantage of the GDP is that since it is computed in a very standardized and clear manner, it is simple to compare previous GDP values to judge the health and strength of the economy. Economists are also able to convert GDP values from different nations to compare the economies of the two countries with each other. The key goal with GDP is to quantify and show that a country’s economy has improved since the previous year. Many nations issue more than one GDP estimate in the year to give people a rough idea of just how well the economies is doing.
One of the major problems with the GDP is that the value does not account for other gray and black markets. While this issue may not seem like a major one, some countries have extremely trafficked black markets which may actually represent a significant portion of the GDP. The GDP value also fails to account for the distribution of wealth of the country, with GDP per capita value hiding economic disparities that may exist. For example, the United States has a very high GDP per capita, but a large disparity between the poorest and wealthiest Americans.
GDP values also do not account for the quality of the services and goods produced, or the reason for why they were produced. An example of this is how a country recovering from a national disaster may spend a large amount of money making repairs, which increases the GDP, but the disaster is not necessarily linked to the country’s economic growth. 

GDP per Capita

GDP per Capita

What is GDP Per Capita?
GDP per capita is a way to measure how prosperous a country in respect to each of its citizens. To understand what GDP per capita, it is first necessary to understand GDP, or Gross Domestic Product. Gross Domestic Product, or GDP, is the market value of all final services and goods that are produced within a country in a specific period. The GDP looks the market value to arrive at a value which is then used to examine the growth rate of the economy as well as the overall economic health of the country being looked at. As a measure of the economy, the GDP can be a very useful way to measure the economy.
While GDP is an aggregate figure that does not consider the varying sizes of countries, GDP per capita looks at the value resulting from dividing the total GDP by the country’s resident population on a given date. A helpful value can be obtained alternatively by GDP per citizen, where the total value of the GDP is divided by the amount of citizens that live in the country on a specific date. GDP per citizen in usually pretty similar to GDP per capita in many countries, but can vary largely in countries that high very high amounts of temporary foreign workers. 
Although GDP per capita is not technically a measurement of the current standard of living in the economy, it is often used as an indicator of it. Similarly, while GDP per capita is not a country’s measure of personal income, it can be used to make observations about it. The biggest advantage of GDP per capita being used as an indicator of the standard of living is that GDP per capita is measured widely, consistently, and frequently. GDP per capita is measured in that most countries frequently enough to provide data about the country’s GDP on a quarterly basis, which allows for trends to be observed quickly. 
The major disadvantage of using GDP per capita is that the value is not a measure of the standard of living in the country. Rather, GDP is meant to be a measure of the nation’s total economic activity, which is an entirely different concept.
The rational for using GDP per capita as a proxy for standard-of-living is not that it acts as a good indicator of an absolute level of standard of living in the country, but rather that the living standards often move with the per-capita GDP, so that any changes in living standards are detected readily through changes in the GDP per capita.
Proponents of GDP per capita as a metric of social well-being often argue that the value is a neutral measure and displays what are able to do, rather than what we should do. This idea is compatible with the point that different individuals have different inclinations and different feelings on what well-being qualifies as. 

Security Certificate Overview

Security Certificate Overview

What is a Security Certificate?

 A Security Certificate is a legal instrument that is granted and authorized by the Securities and Exchange Commission (SEC); ‘SEC’ is an acronym for the Securities and Exchange Commission, which is the regulatory body mandated by the Federal government of the United States employed to investigate and regulate matters involving financial and investment activity of the public, commercial market.
A Security Certificate is required in order to authorize the legality and recognition innate within any or all transfers of securities or financial instruments undertaken within the trade and exchange amongst the realm of the public, open market – another name for the stock market.
What are Securities?

Securities are defined as financial instruments that are both traded and exchanged within the realm of the public, commercial market; activities latent within this market rely heavily on transfer and purchase of securities. In contrast to money or hard currency, securities cannot be used as currency within a commercial setting; this means that while securities can be traded and exchanged within the setting of a financial market, individuals in possession of securities are not permitted to use securities as legal tender.
Yet, within individual securities exists an individual monetary value, which is valued both as per its immediate value, as well as its eventual value; eventual value with regard to securities exists as a result of the capacity for the increase or decrease with regard to its valuation.
The Purpose of a Security Certificate

A Security Certificate serves a variety of purposes, which range in classification from the regulation of the transfer of monetary instruments, and well as the governmental mandating of financial activity; the attainment of a Security Certificate not only expresses the latent legality within a financial transaction involving securities, but also commits that transaction to official record. Within the following circumstances, a Security Certificate is typically requires in the event of financial transfer:

Legal Compliance

A Security Certificate acts as a contract upon whose participation solidifies the expressed consent of both parties involved within the transfer of this particular security; a Security Certificate is mandated by the Sec, which requires the adherence to any and all statutes and stipulations conveyed by the innate legality evident within the wording of a particular Security Certificate.
Transfer of Securities
Upon the transfer of securities, a Security Certificate is required by the SEC in order for the completion of the process; this requirement is also imperative with regard to approval of the SEC with regard to the transfer of individual securities – the receipt of a Security Certificate allows for the conveyance of legality within an individual transfer.
Commitment to Official Records

The receipt of a Security Certificate can also provide for both solace and ‘peace of mind’ with regard to the individuals or entities involved in such a transfer; in the event that the transfer of a security requires officiating, the SEC files every Security Certificate awarded within its archives – this results is the official substantiation of an individual transfer as a result of the awarding of a Security Certificate

All You Need To Know About FOREX Brokers

All You Need To Know About FOREX BrokersWhat are FOREX Brokers?

FOREX Brokers are financial professionals who participate in the exchange of currency systems; FOREX is commonly implemented as a substitution for the term ‘Foreign Exchange’, which classifies the origin of specific monetary systems eligible for trade. FOREX brokers conduct their financial activity through the analysis of currency exchange rates, an activity undertaken within the FOREX Market – also known as the Foreign Exchange Market.

FOREX Brokers operate in accordance variety of factors exist within the dynamic of the FOREX market, which vary in their respective focus – FOREX Brokers may implement various strategies with regard to the analysis of exchange rates, monetary systems, economics, and financial circulation.

FOREX Brokers vs. Stock Brokers



FOREX Brokers operate within the realm of the highly-specialized financial field known as FOREX trading. Similarly to their counterparts who undertake the trade and exchange of stocks, both brokers are subject to all expressed and applicable legality latent within activities rooted in financial exchanges.
Many of both the crimes, as well as the legal statutes implicit within the stock market and investments are applicable to FOREX Brokers; the legal protocol with regard to financial exchange and trade is required to be followed. FOREX Brokers – as well as FOREX Trading Firms – will be subject to any or all financial investigations undertaken by the presiding government of the country or nation.

FOREX Brokers’ Trading Strategies

The following strategies are commonly undertaken by FOREX Brokers engaging in the trade and exchange of foreign currency systems; although FOREX trading strategies are not limited to the following examples, the following examples are considered to be amongst the most widely-employed:
A Fundamental FOREX Trading System is a system of currency exchange analysis that involves an individual conducting investment activity as per the respective stasis of the economy belonging to the country or nation in question.
In contrast with a Fundamental FOREX Trading System, a Technical FOREX Trading System consists of the applied investigation and analysis of trends latent strictly within the valuation patterns of the currency system in question; this type of FOREX trading system focuses on the
Specialized FOREX Brokers.
The following are some examples of specialized trading systems undertaken by FOREX Brokers:
Futures

FOREX Brokers specializing in currency exchange futures typically require individuals to participate in prearranged trading activity on a pre-agreed time within the future; the conditions and results of that exchange activity is subject to – and contingent upon – the applicable valuation of that future date.
FOREX Hedging
FOREX hedging involves the investment of a variety of currency systems undertaken by FOREX Brokers with the hopes up rendering economic gain despite peripheral loss; although hedging FOREX investments is not innately illegal, Hedge-based FOREX Trading Scams are not uncommon.

Legality and FOREX Brokers

Individuals interested in engaging in FOREX Trading ventures and operations are encouraged to consult with legal professionals specializing in finance and international law prior to hiring FOREX Brokers; a legal background of this type will allow clientele to be privy to any or all implicit statutes and legal procedures latent within commercial ventures existing on an international level

Know How To Use FOREX Charts

Know How To Use FOREX ChartsWhat are FOREX Charts?

FOREX Charts exist with respect to realm of international finance trade and exchange; FOREX Charts serve as indicators that illustrate the movement, behavior, and trends accredited to FOREX rates in an observable fashion. Akin to charts attributed to investments and stocks that can be found in periodicals and newspapers, FOREX Charts function as informational resources with regard to trading currency; this includes retroactive illustration of value fluctuation, financial losses, and gains. FOREX Charts, which is a colloquialism for the term ‘foreign exchange charts’ is the systematic resource tool employed as an guideline for those exchanging various forms of currency – both inside and outside of the a commercial market.

How to Use FOREX Charts



The use of FOREX Charts allows an individual to observe any or all fluctuation with regard to the valuation innate within various currency and monetary systems. Fluctuation in value is typically illustrated in FOREX Charts through a display of a variance in trends or behaviors in which circulated currency belonging to an individual country or nation may result in a multitude of results:
While the valuation of certain currency may render financial gain with regard to Currency Exchange, currency experiencing severe decreases in valuation may render financial loss upon Currency Exchange – FOREX Charts allow individuals to observe this activity in the form of a timeline
FOREX Charts may be used within the setting of the commercial exchange of foreign currency; this setting is also known as the FOREC Marketplace; FOREX Charts allow for the analysis of prospective purchase or sales of specific currency systems – these investments render economic gain or loss with regard to respective valuation
In tandem with the invention of the financial investment market, FOREX Charts may be utilized within the recreational or private sector; in the event that an individualwishes to travel to another country or nation and wished to exchange their native currency with regard to the currency utilized in the destination country, FOREX Charts may provide assistance with currency exchange rates

What are Virtual FOREX Charts?

The earliest forms of FOREX Chartswere not only limited to – but conceived under the presumption that any or all currency exchange would be conducted within a physical setting. Yet, subsequent to technological advancements, virtual FOREX Charts were constructed – and subsequently implemented – for online and digital use:
Similar to their physical counterparts, virtual FOREX Charts operate with regard to the dynamic of exchange rates, historic representation, and retroactive illustration
Virtual FOREX Charts may assist in the engagement within the trade and exchange of International currency subsequent to analysis and strategies undertaken as a result of the monitoring and study of past behavior displayed byy that specific currency system.
FOREX Charts provide individuals with the collective ability to utilize electronic resources in order to investigate the wide variety of observable trends and patterns latent within the stasis of a country’s respective economy, which may include financial solubility, economic growth, the development of industry, and prosperity

Easy Guide To Historic Exchange Rates

Easy Guide To Historic Exchange Rates What are Historic Exchange Rates?

Foreign Exchange Rates – oftentimes referred to as ‘FOREX Rates’ are the observable fluctuation with regard to the rate of innate valuation assigned to specific monetary systems belonging to individual countries and nations. The investigation into past behavior and trends expressed within Foreign Exchange Rates may allow individuals the opportunity to become acclimated with specific trends and behavior with regard to the trade and exchange of foreign currency.

Why Are Historical Exchange Rates Important?

Due to the fact that Foreign Exchange Rates are perpetually subject to experience unexpected – and sometimes unforeseen fluctuation – the prospect of rendering gain or loss is considered to be implicit within the participation in currency exchange. Although Historical Exchange Rates are no longer applicable to current day, their investigation may allow for a heightened understanding of currency exchange rates with regard to variance and fluctuation:
Historical Exchange Rates and the Economy

Historical Exchange Rates may shed light on the economic stability, viability, and prosperity undergone by a specific country or nation. The economy of individual countries is considered to be a primary determinant of exchange rates – as a result, Historical Exchange Rates may illustrate stability latent within the respective economies of nations, the rate of production with regard to an individual import and export industry.
Historical Exchange Rates and Financial Trends
The trends expressed within documentation reflectingHistorical Exchange Rates are considered to be instrumental in the assessment of valuation with regard to both the prediction and anticipation of the respective monetary systems facilitated by specific countries and nations. Foreign Exchange Rates illustrating noticeable increases resulting from unidentifiable catalysts – ranging from a stimulated economy to financial prosperity – suffices for additional projections and expectations with regard to the FOREX Market.
Historical Exchange Rates and Fixed Rates

The analysis of Historic Exchange Rates may provide valuable information with regard to strategies implemented with regard to Fixed-rate currency systems. Within a fixed-rate currency, the trade and exchange of currency is limited to those with a fixed rate of valuation, which results in the value of the individual Fixed-rate currency remaining stationary and stable – this takes place despite peripheral activity or applicable dynamics.

Historical Exchange Rates and Futures
Futures involve trade and exchange activity that may be undertaken with regard to anticipated participation in prearranged trading activity; participation within currency futures require the parties involved to reconvene at a future date – the conditions and results of that exchange activity is subject to applicable valuation of that future date. Upon studying Historical Exchange Rates, further understanding with regard to investment strategies employed may be applicable.

Historical Exchange Rates and FOREX
Historical Exchange Ratesmay be implemented for commercial purposes in addition to instruments reserved for international travel; through the use of Historical Exchange Rateswith regard to activity undertaken within the FOREX Marketplace, trade and exchange activities may be undertaken with the hope of earning gains with regard to projection illustrated in activities, fluctuation, and trending occurring in the past.

EDGAR

EDGAR

What is EDGAR?
EDGAR – Electronic Data Gathering Analysis and Retrieval– is an acronym for the filing process employed by the SEC, which is the regulatory body employed by the Federal Government of the United States with regard to the authorization of legality existing within the realm of the public investment market. The EDGAR system is defined as an investigative measure undertaken within the SEC Filing process; prior to the granting of permission to participate in public trade and exchange of a company’s stocks and securities, that company will be required to both provide all applicable documentation, as well as receive approval from the SEC and the submission of applicable documentation and forms.
Components of the EDGAR Filing Process
Within the engagement of Electronic Data Gathering Analysis and Retrieval, individual companies and corporations wishing engage in trade and exchange activities undertaken of the public market, which is also known as the stock market, are required to fulfill the requirements expressed by the SEC; within the realm of EDGAR, there exist a variety of stages to complete prior to the receipt of approval:
Companies may be required to provide any or all financial history with regard to the source of their respective funding; this is required in order for the Committee overseeing EDGAR to properly ascertain the nature – as well as the implicit legality – with regard to the funding of a respective company.
The mention of any or all holding companies, subsidiary companies, or mergers with regard to the ownership and operation of an individual company; the provision of this information allows for the Committee responsible for overseeing EDGAR to review any potential areas for collective or conspiratorial financial activity to take place.
The provision of earnings reports in tandem with spending reports; the provision of this material allows the Committee overseeing EDGAR to ensure that funds and monies earned by an individual company are not – or have not been – the subject of misappropriation or fraudulent activity; the nature of fiscal activity undertaken by an individual company allows for the accounting of funds, which substantiates lawful and ethical disbursement.
The provision of any or all reports of past criminal indiscretion with regard to finance and capital; the ‘EDGAR Process’ allows for the general populace to be privy to pertinent information with regard to the operation of an individual company – although past indiscretions do not necessarily constitute for rejection by the Committee overseeing EDGAR, that information is legally required to be made available to the general public.
The Purpose of EDGAR
The implementation of EDGAR was enacted as a preventative means undertaken by the Federal Government of the United States in order to not only regulate, but maintain authority over the financial activity undertaken by companies and corporations engaged within the trade and exchange activity taking place within the setting of the public, open market. The prevalence of government regulation, which is considered to be one of the many benefits of the EDGAR process, allows for the strict adherence and uniformity with regard to applicable legality concerning financial, as well as commercial matters.

Facts About the Sarbanes Oxley Act

Facts About the Sarbanes Oxley Act

What is the Sarbanes-Oxley Act?

The Sarbanes-Oxley Act was a piece of legislature that was passed in the year 2002; this act was proposed by Maryland Senator Paul Sarbanes and Ohio Senator Michael Oxley as means to provide added protection and security to the United States economy, while enacted more strict investigative and regulatory measures with regard to corporate finance, investing, and the trade – and exchange – taking place on the Commercial Market.
The Sarbanes-Oxley Act, subsequent to its passing, instituted the required fulfillment of a variety of federal stipulations and authorization on the part of any or all publically-traded companies with Market Capitalization values exceeding $75 million. The Sarbanes-Oxley Act is perceived to be a direct response to the ENRON Corporation Scandal uncovered only a year prior to the passing of the Act.


Components of the Sarbanes-Oxley Act

Within the act, a vast array of stipulation, requirements, and classifications exist with regard to their respective – and mandatory – adherence on the part of applicable corporations; the following elements of the Sarbanes-Oxley Act are some of the most common:

Market Capitalization
Market Capitalization, which is the total calculation of a value of an individual company’s stocks and bonds in circulation within the public – or stock – market. The Sarbanes-Oxley Act enacted that every corporation exceeding a $75 million Market capitalization value would be required to adhere to the stipulations and legality expressed within the Bill; in contrast, – ‘Microcaps’ or ‘Penny Stocks’, which are defined as corporations whose respective Market Value does not exceed $50 million – would not be required to adhere to the legislature expressed within the Sarbanes-Oxley Act.


Government Regulation
The Sarbanes-Oxley Act was promoted in order to address the inadequacies that both Senator Sarbanes, as well as Senator Oxley had perceived to be latent within SEC regulations; the SEC – also known as the Securities and Exchange Commission – is the governmental body under whose jurisdiction regulation and investigation of financial activity on the public market exists.
Although the SEC had been imposing audits and investigations with regard to alleged financial fraud, the Sarbanes-Oxley Act expanded on the implicit regulations with regard to financial companies suspected of illegal and unlawful activity.


Financial Fraud

The Sarbanes-Oxley Act not only expanded on the jurisdiction of the SEC, but also elaborated on punitive measures regarding criminal activity taking place with regard to corporations on an internal level – ‘internal’ is considered to represent the following:
The Sarbanes-Oxley Act mandates that any company or corporation suspected of destroying, forging, altering, or concealing official documentation may be subject to supplementary prosecution in addition to any or all preexisting charges.The Sarbanes-Oxley Act allows audits to take place by the SEC with regard to the investigation of any or all financial records in existence within a company or corporation applicable to this Act.
The Sarbanes-Oxley Act authorizes the SEC the permission to investigate and authorize the process, history, and procedure with regard to any or all internal loans, transfer of funds, and movement of assets taking place within the infrastructure of the company.


Whistleblower Clause

Within the Sarbanes-Oxley Act, there exists a clause entitled the ‘Whistleblower Clause’, which draws on the informal title of an individual not employed by an official law enforcement agency, who brings a perceived injustice to light; this clause within the text of the Sarbanes-Oxley Act allows for the protection and accommodation of compliant employees agreeing in the cooperation of SEC-conducted investigations.
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