The audit changes drastically when it's time to do an IPO. The auditors' perceived risk increases exponentially, and so do their audit scope and procedures. Furthermore, since the passage of the Sarbanes-Oxley Act ("SOX"), auditors are under much stricter independence requirements and therefore are not able to advise their clients through the IPO process as was the case prior to SOX. Thus the IPO audit can be a very difficult process. And a bad audit can seriously jeopardize your ability to price and sell your IPO shares in a favorable market window. The entire IPO process can be derailed. We can help.
We know what the auditors need, and we can provide it with the substance and form required to make sure the IPO process stays on track. We are your advocates. We fully come alongside you to support you and advise you.
We research relevant technical accounting guidance and ensure that your accounting records and financial statements are aligned with the current state of United States generally accepted accounting principles ("U.S. GAAP") – an ever moving target. We make sure your revenue recognition is air tight. We document all of your key accounting policies and positions, supported by technical accounting research that will withstand the scrutiny of the auditors and the SEC. We analyze your pre-IPO stock option grants, to see if adjustments in previously recorded stock-based compensation are needed. We compute your basic and fully diluted earnings per share ("EPS"). We compile fully compliant U.S. GAAP financial statements, including extensive footnotes.
No matter how thorough the auditors are (and they are extremely thorough in every IPO), the SEC adds even more scrutiny. We help respond to the SEC comments and questions. Again, we are your advocates.
Glenn Ballard, CPA is the leader of the IPO consulting practice. Glenn has been practicing corporate finance and accounting since 1995. Glenn has 11 years of experience with “Big 4” accounting firms, with most of those years spent in Silicon Valley, where he led numerous IPO audits. Glenn moved to Silicon Valley during the “dot com boom” specifically to work on IPOs. Before founding Marpé, Glenn gained additional IPO consulting experience at a boutique Silicon Valley consulting firm. Glenn was first licensed as a Certified Public Accountant in 1998, and he continues to hold an active CPA license in both California and Georgia.