Which of the Following Statements Is False

question 21

Multiple Choice

Which of the following statements is false?

• A) Once a company goes public, it must satisfy all of the requirements of public companies.
• B) Organizations such as the relevant provincial Securities and Exchange Commission (SEC), the securities exchanges (including the TSX), and the Parliament of Canada adopted new standards that focused on more thorough financial disclosure, greater accountability, and more stringent requirements for the board of directors.
• C) The major advantage of undertaking an IPO is also one of the major disadvantages of an IPO: when investors diversify their holdings, the equity holders of the corporation become more concentrated.
• D) Several high profile corporate scandals during the early part of the twenty-first century prompted tougher regulations designed to address corporate abuses.

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Definitions:

Incremental Costs

Additional costs that a company incurs when increasing production or undertaking new projects.

Pro Forma Financial Statements

Financial reports that project the future financial position of a company, based on current data and assumptions.

EAC Methodology

The Equivalent Annual Cost method, used to compare the economic cost of projects with different lifespans by converting their costs into an equivalent annual amount.

Decision Making

The cognitive process of selecting a course of action from among multiple alternatives, typically aimed at achieving a specific goal.