Securities And Exchange Commissions (SEC) SS3 Financial Accounting Lesson Note

SPECIFIC OBJECTIVES: At the end of the lesson, pupils should be able to

1. Define regulation
2. State reasons for regulation of the capital market
3. List types of regulations.

INSTRUCTIONAL TECHNIQUES: 

• Identification, 
• explanation, 
• questions and answers, 
• demonstration, 
• videos from source

INSTRUCTIONAL MATERIALS: 

• Videos, 
• loudspeaker, 
• textbook, 
• pictures

NOTE

REGULATION OF THE CAPITAL MARKET

Regulation of the capital market refers to the rules and modalities set by the capital market to promote just and equitable principles of trade and sound business practices by global best practices.

NOTE: The capital market is regulated by the Securities and Exchange Commission (SEC), which is the apex regulatory body of the Nigerian Capital Market.

 REASONS FOR REGULATIONS OF THE CAPITAL MARKET

The following are reasons for the regulation of the capital market:

1. To protect investors. Investors are a key element in the growth of companies and also the expansion of the company.
2. To ensure the markets are fair, efficient, and transparent. Transparency in the market will boost the confidence of investors and other players in the market.
3. To ensure financial stability. It helps in the continuity of returns on investment and this will also enhance economic growth.
4. To promote economic recovery and development.
5. To reduce systematic risk. This is to ensure that investors are protected and adequately covered.

 TYPES OF REGULATIONS

There are two types of regulations in the capital market. They are;

1. Statutory Regulation
2. Self Regulation.

STATUTORY REGULATION: this refers to modalities put in place by the government to ensure orderliness in the capital market. These are laws created by a legislative enactment.

SELF-REGULATION: It is also known as non-statutory regulation. This refers to the internal rules and guidelines set in place by the Nigerian Stock Exchange.

EVALUATION:            

1. What is capital market
2. Mention two reasons for regulation of the capital market
3. List the types of regulations.
4. State four functions of the capital market.

CLASSWORK: As in evaluation

CONCLUSION: The teacher commends the students positively