An IPO is a major milestone in the development of a tech firm and represents value for its founders, employees, and customers. But it also creates the company with a new set of rules, regulations and requirements that the company might not have had to adhere to as a private enterprise. The key to success is to be prepared in advance, and that starts with a complete IPO preparation checklist.
The first step is establishing a fully functional system that enables the company to maintain an accurate financial record that will stand up to the scrutiny of shareholders and regulators. This is a top priority for the CFO’s team. It should be addressed well before the IPO date. This typically means setting up an automated reconciliation process to eliminate the manual errors in the data, as well as ensuring that the company is on track in achieving IFRS and US GAAP compliance, and setting up necessary committees on the board such as audit special finance, compensation and audit committees.
A strong management team is also important. They will be able to manage the growth plans for the business when it goes public. This is typically the most important non-financial aspect to consider when preparing for an IPO. Investors are looking for a management team that has demonstrated their abilities.
An experienced auditor or advisor should conduct an IPO readiness assessment to determine the current state of internal control and accounting designdataroom.com/what-you-need-to-know-about-ipo-process practices and other issues that need to be addressed before the IPO. This assessment should be performed before the IPO to allow any deficiencies to be corrected prior to being disclosed to investors or the SEC.
