In the U.S., public companies’ financial details are transparent to all

Clouds and sun reflected in building (© Andrew Harnik/AP Images)
The U.S. Securities and Exchange Commission puts information on publicly traded companies in an easy-to-use database. (© Andrew Harnik/AP Images)

In the U.S., all investors, and even potential investors, are entitled to know the financial details of companies in which they are investing.

Public companies that raise capital in U.S. markets or are looking to tap capital must file documents with federal regulators. U.S. regulators make sure that the filings are made transparent to the public, including journalists and competitors, in a reliable and easy-to-search database. Such transparency protects investors against financial fraud.

The Securities and Exchange Commission (SEC), an independent federal agency, puts the corporate annual statements, quarterly statements, shareholders’ meeting reports and other financial information on an easy-to-use database called EDGAR, which stands for the Electronic Data Gathering, Analysis, and Retrieval system.

“EDGAR gives investors and the public very detailed financial information on publicly traded companies,” says Martha Steffens, a professor of financial journalism at the University of Missouri. Steffens works with the Society for Advancing Business Editing and Writing and has trained financial journalists in more than 40 countries.

The EDGAR database makes millions of company filings transparent to investors, corporations and journalists. By searching a company’s name, a user can bring up everything the company has shared with regulators.

EDGAR offers a detailed picture of a company’s financial health. One can find profit and loss, as well as a plethora of information about company owners. The database also lists notifications about major financial/accounting issues or legal proceedings a company faces.

“Edgar is an invaluable resource for reporters,” says Nate DiCamillo, an economics reporter at Quartz. “I use it to be quickly alerted of SEC enforcement actions against companies as well as to get a quick look at public firms’ financials.”

According to the SEC, EDGAR processes about 3,000 filings per day, serves up 3,000 terabytes of data to the public annually and accommodates 40,000 new filers per year on average.

Pen and calculator on numerical report on desk (© create jobs 51/
(© create jobs 51/

Reports filed with the SEC include:

  • Annual and quarterly reports.
  • Proxy statements about shareholder meetings.
  • Executive compensation reports.
  • Transactions from corporate insiders — officers, directors and large shareholders.
  • Merger and acquisition details.
  • Registrations and prospectuses for initial public offers and other offerings.
  • Statements on securities-based crowdfunding, a way to raise money from small individual investors or large numbers of individuals.
  • Foreign private issuers (certain public companies formed outside the U.S. that must file forms with the SEC).
  • Regular statements from mutual funds and exchange-traded funds.

Accessing EDGAR’s public database is free. “EDGAR creates a securities market that is efficient, transparent and fair,” Steffens says. “Without EDGAR, those with inside information could profit at the expense of the general public.”

Freelance writer Holly Rosenkrantz wrote this article.