A public offering offers private companies the chance to make huge gains in expansion, but it also exposes them to rules and regulation that they weren’t required adhere to when they were private companies. As such, it is essential for companies to comprehend all the possible risks and pitfalls before making the plunge into public markets.
If your business is contemplating an IPO or not, creating a best-practice checklist should be the first step to ensure you’re ready for the process. A checklist for an IPO should encompass everything from stakeholder alignment due diligence to the collection and analysis of financial data. A thorough checklist will enable you to pinpoint and close gaps between where your business is at and where it helpful hints ought to be prior to bells ringing for the IPO bell.
It is a good idea to consult a tax expert if you are planning to go public. This will aid you in understanding the various kinds of equity compensation and how they can affect your tax cost. You can then prepare accordingly. If you’ve made an 83b) decision, you could face a large increase in the taxable ordinary income if you go public. If you’re an owner of incentive stock options (ISOs), you should prepare for the possibility of being be subject to an alternative minimum tax.
A checklist for an IPO should also include information on the requirements for compliance with regulatory regulations that are required for an IPO. This includes the Securities and Exchange Commission (SEC) regulations regarding disclosure and registration. Your IPO checklist should include all the steps required to prepare and file your Draft Registration Statement/S-1 and include submissions of both EDGAR files and iXBRL examples.
