Deficiency Letter

AAA

DEFINITION of 'Deficiency Letter'

A letter, issued by the Securities and Exchange Commission (SEC) indicating a significant deficiency or omission in a registered statement or prospectus. A deficiency letter should be dealt with promptly, and the SEC should be alerted of any actions taken to remedy the situation.

INVESTOPEDIA EXPLAINS 'Deficiency Letter'

When issuing securities, a deficiency letter will usually disrupt the process. The letter will often halt the registration process, postponing the date of the issue. This prevents a company from receiving funds at an expected date. Furthermore, a stop order may be issued along with the deficiency letter. This will prevent any sale of the securities in the issue until the deficiency is handled.

RELATED TERMS
  1. Determination Letter

    A formal document issued by the IRS that decrees whether or not ...
  2. New Issue

    A reference to a security that has been registered, issued and ...
  3. Securities And Exchange Commission ...

    A government commission created by Congress to regulate the securities ...
  4. Prospectus

    A formal legal document, which is required by and filed with ...
  5. Initial Public Offering - IPO

    The first sale of stock by a private company to the public. IPOs ...
  6. Issue

    1. The process of offering securities as an attempt to raise ...
Related Articles
  1. Fundamental Analysis

    Interpreting A Company's IPO Prospectus Report

    Learn to decipher the secret language of the IPO prospectus report - it can tell you a lot about a company's future.
  2. Investing

    5 Tips For Investing In IPOs

    Thinking of investing in IPOs? Here are five things to remember before jumping into these murky waters.
  3. Investing Basics

    Policing The Securities Market: An Overview Of The SEC

    Find out how this regulatory body protects the rights of investors.
  4. Retirement

    IPO Basics Tutorial

    What's an IPO, and how did everybody get so rich off them during the dotcom boom? We give you the scoop.
  5. Personal Finance

    How Minimum Wage Impacts Unemployment

    We explain how the minimum wage affects unemployment, public assistance, and the economy overall.
  6. Entrepreneurship

    How is venture capital regulated by the government?

    Learn about some of the ways in which the U.S. government and the Securities and Exchange Commission regulate venture capital.
  7. Bonds & Fixed Income

    How Diaspora Bonds Work

    Developing and emerging nations with sizable populations living overseas are using diaspora bonds to raise financing from emigrants.
  8. Fundamental Analysis

    What is the difference between EBIT and operating income?

    Read about some of the subtle differences identified by the SEC between earnings before interest and taxes, or EBIT, and operating income.
  9. Fundamental Analysis

    What kind of financial reporting requirements does GAAP set out?

    Look at some of the major financial reporting requirements set forth by the generally accepted accounting principles and the required financial statements.
  10. Economics

    The Economic Impact of Better US-Cuba Relations

    We examine what the normalization of relations between the US and Cuba will mean for the two countries' economies.

You May Also Like

Hot Definitions
  1. Multiplier Effect

    The expansion of a country's money supply that results from banks being able to lend. The size of the multiplier effect depends ...
  2. Command Economy

    A system where the government, rather than the free market, determines what goods should be produced, how much should be ...
  3. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  4. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  5. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  6. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
Trading Center