Investors use the information in disclosure documents, such as a summary prospectus or an offering memorandum, to make informed investment decisions. Securities exempt from registration provisions under federal law, such as a private placement, provide disclosure through the offering memorandum. The prospectus must be approved by the competent authority in the United Kingdom, which is currently the Financial Conduct Authority (FCA) in its capacity as the United Kingdom Listing Authority. If the purpose of the prospectus is to induce people to engage in an investment activity, it will also need to be issued or approved by an 'authorised person' or it will constitute an unlawful financial promotion under section 21 of the Financial Services and Markets Act 2000. Publication of information in relation to the issue of securities in the United Kingdom is governed by the Prospectus Rules, which implement the European law Prospectus Directive. A prospectus must be published where certain types of securities either are offered to the public or are requested for admission on a regulated market. In investment banking, you might start marketing your client without creating a complex model first (Why bother if no one wants to buy the company?). It can also protect the company offering the securities from liability, acting as proof that the investor was fully informed. Consult an attorney before creating an Offering Memorandum. If a company has been filing Form 10-K with the SEC for a certain period of time, has a market capitalization above a certain threshold, and takes certain procedural steps, it is permitted to offer securities using a simplified prospectus that incorporates information by reference to its SEC filings. In certain situations, such as when the offering is not required to be registered with the SEC, a prospectus is instead referred to as an "offering memorandum" or "offering circular." In the case of municipal securities offerings, which are generally exempt from most of the federal securities laws, municipal issuers typically prepare an analogous form of disclosure document known as an "official statement." Prospectuses are generally prepared with the assistance of the underwriter acting as issue manager (also called a bookrunning manager or "bookrunner").