Page 132 - Initial Public Offering - An Introduction to IPO on Wall Street

and top executives of the filing business. The cost of a roadshow can differ greatly as each
business’s show is unique in terms of the venue, duration, and level of extravagance.

6.1.2 Pre-IPO Indirect Costs
Since a report of indirect costs is not needed in the statement of registration, these costs are
very difficult to accurately estimate. In addition, each business has specific requirements, so
the scope and depth of indirect costs vary significantly from business to business. This is
particularly true for the cost of restructuring, as one business may require almost no
restructuring, while another may need a "ground to ceil" job.

The following section will explain what is involved with each of the relevant cost areas, rather
than attempting to make an estimation that would not be useful to most businesses. This
information should assist you in making a reliable estimation that will be more reflective of
your own specific needs.

Costs of Restructuring, Including the Audit Committee Charter

The costs needed to restructure a business can occur as late as one month or two before the
filing takes place, or as early as two to three years before the filing takes place. These costs
consist of legal, IT, human resources, audit, assessment, and financial consultancy fees.

The establishment of the internal legal team, a tax authority, an investor relations unit, an
internal audit unit and the audit committee, the formulation of by-laws, the introduction of new
systems for accounting and reporting, the development of new employee benefit programs, and
the production and recording of internal controls are among the restructuring matters to be
addressed. The size of these costs will be dictated by the amount of time required for this
restructuring and the number of specialist services that are available for your particular needs.

Costs to Make Financial Statements S-X Compliant, Valuation Services, and Reports,
and Articles of Incorporation

Other than the restructuring costs, you are likely to incur costs associated with valuation
services for adherence with 409A, cheap stock analysis, and any other valuation services
required; reviews of financial statements; and consultancy services to assist in the development
of articles of incorporation and to ensure compliance with the S-X regulation.

6.1.3 Post-IPO Recurring Costs
As per the 2015 article by PwC entitled "Considering an IPO? An insight into costs post-JOBS

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