How to go public?

The first step to go public includes detailed discussions about corporate objectives, strategies, milestones, planning and organization relating to the public listing process.

While many companies use QuickBooks, Xero or other accounting platforms, these systems do not generate financial statements that satisfy public company disclosure standards. Part of the process to go public includes preparing financial statements with supporting schedules and worksheets to provide auditors.

As a public company, one of the most important disclosures and areas of transparency relates to financial results. Public companies are required to provide three quarterly reports and one annual report, which includes audited financial statements. To go public, a company will need audited financial statements that covers the period from incorporation through to a most recent quarter end, but no more than two full calendar years plus a year to date period.

Public companies are obligated to provide non-confidential disclosures that satisfy regulatory requirements within a document called a registration statement. This document includes sections about the history of the company, business, management team, risk factors, financial statements and other important facts. The registration statement is reviewed by the Securities and Exchange Commission and in certain cases, by State regulators as well.

The final high-level step in the process to go public includes filing an application with the desired stock exchange. Since most of our clients are earlier stage companies, they can qualify for a listing on the OTC QB. Larger clients can apply for listing on the NASDAQ or NYSE if they qualify. Companies that don't initially qualify for a major exchange can start on the OTC QB, build and then up list when qualified to do so.

Most companies don't have the internal skill set, experience or knowledge required to plan and manage the process to go public. As a result, they either start a process they often can't successfully complete or engage a professional consulting firm that can help them complete a direct listing, direct public offering or initial public offering.