A. The authoritative literature that addresses the disclosure of information about
the capital structure is found in FASB’s Superseded Standards. It is under
FAS 129: “Disclosure of Information about Capital Structure.”
1. Securities: the evidence of debt or ownership or a related right. It
includes options and warrants as well as debt and stock.
2. Participation Rights: Contractual rights of security holders to receive
dividends or returns from the security issuer’s profits, cash flows, or
returns on investments.
3. Preferred Stock: A security that has preferential rights compared to
C. Companies should disclose:
-505-10-50 Disclosure: (50-2) For securities, companies must disclose any changes in shareholders' equity and any changes in the number of shares of equity securities during at least the most recent annual fiscal period and any following interim period presented. Companies may disclose this information in separate statements, in the basic financial statements, or in the notes. (50-3) Companies should also disclose the pertinent rights and privileges of any securities outstanding. Companies must also disclose the number of shares issued upon conversion, exercise, or satisfaction of required conditions during at least the most recent annual fiscal period and any subsequent interim period presented.
-505-10-50 Disclosure: (50-4) In the case of preferred stock, a company should disclose the liquidation preference of the stock. The disclosure should be made in the equity section of financial position in the aggregate (parenthetically or in short) rather than on a per-share basis or through disclosure in the notes. (50-5) A company should also disclose (either on the face of the statement of financial position or in the notes thereto):
a. The aggregate or...