Preparing Your Company to Go Public
As the market shows signs of improvement, a growing number of private equity firms are exploring opportunities to take their companies public. To realize value from an initial public offering (IPO), your timing is absolutely critical.
But many private equity firms and their portfolio companies discover that before taking their company public, there are considerations and requirements that take more time and effort than they had expected. These include corporate governance, financial statements, Securities and Exchange Commission (SEC) disclosures, Section 404 of the Sarbanes-Oxley Act of 2002 (SOX 404), and information technology (IT) systems.
Crowe Horwath LLP can help you prepare for and manage a timely exit strategy. We can help guide you through the IPO registration process and help you address the critical steps that are needed throughout the IPO – and beyond.
Your IPO preparedness plan should focus on the depth of your coverage in all high-risk areas rather than the breadth of coverage across all financial statement accounts. Crowe recommends that you:
- Establish corporate governance and compliance programs for your holdings or portfolio companies at least 18 months before filing the second SEC Form 10-K;
- Ensure all financial statements conform to SEC requirements and are performed by a firm registered with the Public Company Accounting Oversight Board (PCAOB)-;
- Focus on developing a SOX 404 compliance program;
- Build an IPO preparedness plan at least six months prior to any contemplated IPO;
- Have IT systems in place and functioning prior to an IPO;
- Consider pre-IPO tax strategies; and
- Have an appropriate amount of time and skilled resources dedicated to the plan.
Crowe is one of the largest public accounting and consulting firms in the United States and has assisted public and private company clients in reaching their goals through audit, tax, advisory, risk, and performance services. We are also one of only 10 accounting firms in the United States subject to an annual inspection by the PCAOB.