IPO Preparation Tips

by Andrew Chambers (Addison Group Marketing Team) 09/18/2019

Many companies have decided to go public due to the healthy stock market. However, going public is a major decision and there is a lot that goes into IPO preparation. How can you be sure it is the right path for your company? Companies need to thoroughly evaluate their ability to handle the ins-and-outs of being a public company before jumping in. It requires that management is able to immediately meet shareholder and market expectations from the first day. Including addressing compliance and regulatory requirements, operational effectiveness, risk management, periodic reporting, and investor relations.

Companies must create an extensive IPO plan that balances the short-term objectives with long-term goals and allows for the coming rush of real-time reporting required of a public company.

Time-specific issues in IPO Preparation

Investor Relations

The C-suite executives should launch a promotional campaign providing investors and financial analysts the opportunity to ask them questions about the company. This campaign should include revenue, outlook, net income and operating cash flows. This process should be done as early as, while the SEC is reviewing the company’s Form S-1.

Upgrade Financial Reporting Platforms

It’s imperative to upgrade to an automated financial-reporting solution that is scalable and easily integrated with other systems, including budgeting and forecasting, enterprise resource planning and customer management. As manual accounting, budgeting and general ledger upkeep are prone to errors and are time-consuming.

Processes and Controls

Prior to going public, it is important to perform a risk assessment to discover high-risk gaps. Along with the CFO, the CEO, accountants and legal team should all review the risk assessment.

Is 2019 Your Year to Go Public?

Finding the perfect time for a company to go public is very difficult. As of right now, many experts feel that 2019 is a great year. But just because this year is good, it doesn’t mean that the next one will be. With the markets continually changing, your best bet is to get all of your company’s accounts and documents in order in case you decide to take the leap.

DLC’s Accounting and Finance Consultants are uniquely positioned with a comprehensive set of skills to guide you through the planning and execution of your IPO.

Topics: