A chapter from "The Entrepreneur's Roadmap: From Concept to IPO"
A company that is planning to go public is subject to a host of new and complex accounting requirements. These range from issues with financial statements, to providing sufficient key performance indicators (KPIs) in management’s discussion and analysis (MD&A), to providing data concerning highly technical accounting issues. Pre-IPO companies will frequently be dealing with many of these items for the first time and can find the SEC requirements to be quite burdensome. However, we have found that companies can tackle the process much more effectively by planning early and by focusing on several accounting issues that have historically raised the most red flags.
A company that has a coherent IPO plan and understands the accounting issues that have historically raised difficulties will substantially limit any surprises during the IPO process. Focusing on these accounting items early on will help to minimize any delays during the SEC comment phase. As recent volatile markets have shown, companies need to have the flexibility to file an IPO when the best market conditions are present. Having key issues resolved early, especially those that involve complex accounting rules, can make it much easier for a company to file at the most opportune moment.
>> For more on this topic, download the full chapter: Getting Your Pre-IPO Accounting House in Order
Aamir Husain, National IPO Readiness Leader
Dean Bell, Partner in Charge and U.S. Head of Accounting Advisory Services
Brian Hughes, National Partner in Charge of Private Markets and National Venture Capital Coleader
Mike Meara, Director, Accounting Advisory Services
Successful entrepreneurs don’t repeat other people’s mistakes. They learn from them. And then they adapt their strategy and roadmap accordingly. But accessing the best advisors, talent and experiences isn’t easy. And if you are a CEO, CFO, Controller or Founder responsible for growing a private company, you may not have the time – or the connections – to get the full picture.
KPMG, in collaboration with the New York Stock Exchange (NYSE) and additional contributors, have developed The Entrepreneur’s Roadmap: From Concept to IPO. This guide is designed to help entrepreneurs by offering critical insights from concept to taking a company public and gain an understanding of both the benefits and challenges through each stage.