See: Financial Statement. And then note that financing usually means that the company raising dough is doing it in one of two ways. Either they are selling ownership stakes in them, or they are borrowing money in the form of debt, such that they then have an obligatoin to pay back that loan...or else. And that "or else" thing usually means that they lose ownership of the company if they don't.
The financing statement covers the myriad legal and financial risks in making all this magic happen.
Related or Semi-related Video
Finance: What is a registration statemen...2 Views
finance a la shmoop what is a registration statement....Hi I'm a
registration statement okay there I said [Uncle Sam poster talking]
it that's a registration statement alright
what am I good for well if you want to go public that is raise money from Joe [Joe Sixpack and Josephine Sixpack appear]
Sixpack and his wife Josephine well then you have to jump through all kinds of
hoops the most important of which is that you have to file a prospectus with
the Securities Exchange Commission or SEC all right what's a prospectus[Prospectus with SEC badge]
it used to be an amateur spectus but the well then it took some continuing ed
classes owned expecting skills and it turned pro and took money all
right well a prospectus basically just outlines all of the information that the
SEC deems is key to the offering like trailing revenues and profits and growth
the units sold, any lawsuits outstanding against the company, distribution,
contracts with vendors patents who the management is debts owed and on and on [examples of what is outlined in a prospectus]
why the need for all this registration well because so many unsuspecting
investors who likely didn't watch this video well they got taken taken in the [Person picks up red phone]
past yeah farmers, not educated government came to their aid they
invested in some sleazy thing that wasn't run through the SEC and now
they're walking around in a barrel saying we'll uh shmoop for food yeah [Man walking in a barrel]
good luck you know the phrase a barrel of fun yeah this is not what it's
referring to [Man walking inside a barrel and a tiger appears]
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