E. REPORTING PROCEDURES. To insure dissemination of reported information, it is advisable that procedures be created whereby interested parties may receive information on a continuing basis. Such parties may include holders of securities, potential investors, securities dealers, analysts and rating agencies. It is suggested tha ssuers or their underwriters maintain a mailing list of all parties who are interested in receiving information. furnished by the issuers. Information may then be mailed to such parties. A reasonable copying, mailing and handling charge may be imposed upon recipients. To facilitate the availability of the information, a reference should be made in official statements for offerings of securities to the existence of the mailing list and the availability of the information. Such a reference should appear conspicuously in securities issued. A reference such as that suggested may read as follows: The issuer has not legally bound itself to furnish to investors current Issuers should make information available to local news publications for dissemination. actively traded, should also make information available to regional and This Work Paper provides for the release of current information on an annual basis. This should be done at a time when the information is still 69-141 O-76-24 5 meaningful for investors, such as within 90 to 180 days after the end of the issuers's, or in the case of revenue securities, the relevant enterprises, fiscal year. Wire this is not possible, release of the information should be made at the earliest possible time. This Work Paper also provides for release, on other than an at al basis, of information describing certain events which may have a dramati effect on the issuer's finances and of information in official statement (Section 6). Such information sh. d be released immediately upon its availability in a reliable form. Issuers should endeavor to obtain reliable information as early as possible so that a prompt release may 2 Financial and accounting information should be prepared and present. in accordance with generally accepted accounting principles, as presente and recommended in National Committee on Governmental Accounting, Gove: mental Accounting, Auditing, and Financial Reporting (1968) and the Ind. y Audit Guide of the Committee on Governmental Accounting and Auditing of the American Institute of Certified Public accountants, entitled Audits of State and Local Governmental Units (1974), as such generally accepted accounting principles are supplemented and modified from time to time.3 These sources make appropriate allowance fo state legal requirements on presentation of financial information. The financial statements should be accompanied by an opinion of independent certified or public account.ats, or, where 2. 3. The National Committee on Govermental Accounting has been recon- 6 appropriate, of state authorities performing procedures and issuing opinions equivalent to those of independent accountants. H. POLLUTION CONTROL AND OTHER INDUSTRIAL DEVELOPMENT OR INDUSTRIAL This work paper is not appropriate for disclosures regarding pollution control or other industrial development or industrial revenue bonds. The investment risk of such securities is in most instances dependent upon the financial success of the private entity involved. Consequently, disclosures substantially similar to those prescribed by Form 10-k promulgated by the Securities and Exchange Commission under the Securities Exchange Act of 1934 should be considered regarding the private entity in such cases. Where additional security is provided by the issuer, disclosures suggested by this Work Paper should also be made. Unless the context otherwise indicates, the following terms have the stated meanings for purposes of this Work Paper: (1) "Issuer" means the governmental unit, subdivision or agency which is the issuer of the outstanding securities, including all departments, divisions and organizations under its operating control. (2) "Enterprise" means any undertaking or group of undertakings of a governmental unit or units or subdivisions or agencies thereof expected to generate revenues which are to be a material source of payment for the principal of and interest or premium on the securities. (3) "Default" means a default as provided in the laws or authorizing or governing instruments with respect to the securities. (4) "Payments of principal" of securities and similar references include, but are not limited to, sinking fund payments. 7 SUGGESTED DISCLOSURES SECTION 1. FINANCIAL INFORMATION. See General Instructions B and G. (a) Furnish appropriate financial statements of the issuer, or in the case of revenue securities, the enterprise, to indicate the issuer's financial ability to fulfill its obligations to the holders of outstanding securities. The financial statements selected for presentation should be selected in accordance with generally accepted accounting principles as presented and recommended in the sources referred to in General Instruction G, as such generally accepted accounting principles are supplemented and modified from time to time. Those financial statements should be presented for, and as of the end of, the last fiscal year. Receipts and assets which cannot be used to discharge the issuer's obligations to the holders of outstanding securities and expenditures chargeable against such receipts should be clearly indicated. Explanation of Section 1(a): 1. Include comparable data for any additional fiscal years necessary 2. Disclose the effects in dollar amounts of extraordinary receipts or expenditures and describe the nature and purpose of the receipts or expenditures. 3. Subject to appropriate variation to conform to the nature of the enterprise items should be included in the operational statements for enterprises net sales or operating revenues; cost of goods sold or operating expenses (or gross profit); interest charges; net income; and special items. 8 4. In connection with the financial statements, whenever necessary, reflect information or explanations of material significance to investors in appraising the results shown, including analyses of material increases or decreases in significant categories. (b) If the issuer has outstanding general obligation securities, and if more than 15 percent of the receipts of the issuer in either of its two most recent fiscal years comes from (i) a single enterprise owned or operated by the issuer (such as a public utility or transportation system), or (ii) a number of such enterprises engaging in essentially similar functions or operating as an integrated enterprise, and if the receipts from such enterprise(s) may be used for payment of principal of or interest or premium on the securities, provide an appropriate financial summary regarding such enterprise(s). (c) If payment of principal of or interest or premium on the outstanding securities is guaranteed or insured in any respect, furnish appropriate financial or other information as to the guarantor or insurer. Under normal circumstances, it is unnecessary to include more than a very brief financial summary as to a state guarantor. SECTION 2. CHANGES IN OUTSTANDING INDEBTEDNESS. The disclosures suggested by this Section 2 should be reported as to indebtedness of an issuer or, if applicable as to indebtedness payable. from revenues of enterprise, if any of the following conditions have occurred: (1) any increases in indebtedness, if the aggregate amount of all such increases exceeds 5% of the aggregate amount of such outstanding indebtedness as last reported pursuant to this Work Paper; or |