Southern New Hampshire University **We aren't endorsed by this school
FIN 335
Oct 12, 2023
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Victoria Heck Southern New Hampshire University FIN 335 Final Project: Milestone Three September 24, 2023
Oversight and Governance Nextracker a publicly traded company on the National Association of Securities Dealers Automated Quotations or NASDAQ. The NASDAQ is an electronic exchange for investors and is compiled of more than 3,000 companies. (Taulli, 2023) The NASDAQ is used as a barometer for the stock market since it tracks so many other companies. For a company to be listed on the NASDAQ there are a few requirements that need to be met. Since the NASDAQ is such a highly respected stock exchange, they are stick on the companies they will allow on their exchange to keep their positive reputation in the investing world. The NASDAQ is a highly respected stock exchange and have several requirements for a company to be listed on the index. There are four requirements, and a company must meet at least three of the requirements. One of the requirements is that the company must have at least one million publicly traded share before being listed on the NASDAQ. (Taulli, 2023) Nextracker currently has 26,600,00 million shares. A company must also pay an application fee to even be considered for the NASDAQ. This application fee is $25,000 plus other fees once a company is approved to be on the NASDAQ, these additional fee can be up to $300,000. (Taulli, 2023) These requirements show that the company needs to be in a good financial position and a base of investors before being a part of the NASDAQ. There are also standards that a company is required to uphold before being placed in the NASDAQ. The most important standard would be that the company requesting to enter, must have a pre tax earnings of $11,000,000. (Taulli, 2023) There also must be an average cash flow of $500,000. The NASDAQ has these standards and requirements for the companies because it is important for the reputation and integrity of the NASDAQ for the investors.
When it comes to the enforcement and regulations there are a few different government agencies that help protect investors and ensure that companies are following the market rules and regulations. First we have the U.S. Securities and Exchange commission or the SEC. The purpose of the SEC is to protect the investors. ( Fast answers 2010) They are there to ensure that the integrity of the market securities. The SEC has requirements that compels companies to report financial information. This is why companies release finance statements, income statements and balance sheets. This information is then available for the investors to analyze and make informed decisions on investments. If a company would chose not to provide this information or even provide wrong information, this would warrant an investigation that could result in the company being removed form the stock exchange, fines, and even criminal charges. Another governing body of the stock exchange is the Commodity Futures Trading Commission or the CFTC. The CFTC is made up of five commissioners, these individuals are selected by the President of the United States and then approved by the Senate. ( Commitments of traders 2007) The CFTC specializes in agriculture, global markets, energy, and environmental markets. Nextracker Inc, would need to be familiar with the regulation of the CFTC since they are a renewable energy company. The CFTC is able to conduct investigations. The CFTC and the SEC do work closely together to ensure that all companies are compliant with the rules and regulations of the stock market to help keep investors protected. There are different rules and regulations for a company wishes to enter into the international exchange. An international exchange is when a company based in a different country wants to enter an exchange not based in their home country. For example, if Nextracker wanted to enter a stock exchange in Europe, they would be entering the international exchange. Nextracker, would need to apply with the Financial Services Authority of the FSA of the United
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