Build a finance organisation that can meet the needs of a public company
The first months of life as a public company are critical.
There is uncertainty among investors and analysts because the company is
relatively unknown. The newly established public company is also
unfamiliar with forecasting results and performance. And the
consequences of not meeting expectations can be severe. In fact, an
inability to communicate effectively with analysts and investors to manage
expectations can be damaging to shareholder value and compromise
As a result, getting the right finance organisation, with the right
capabilities to deliver quality financial reporting at the right time, is an
important factor to a successful IPO.
This is typically achieved by first focusing on getting the monthly
financial close process to a reasonable amount of time for a public company
and then preparing the quarterly, half yearly and annual financial
information with the level of detail and accuracy that is expected of a
A good IPO plan will identify the critical aspects of the finance function
that need to be in place before starting the IPO preparation process, for
example, the CFO and controllership functions. Others, such as public
reporting, can be built up during the IPO preparation process, initially
relying on external resources, migrating to an internal public
reporting function as the IPO launch date approaches. The key is getting
the appropriate balance of resources in place at the right time without
overdoing it before the IPO is certain.