How a company acquired by a PE firm was able to transform into a public company overnight
The issue: Our client, a US-based division of a global conglomerate, was acquired by a premier US private equity buyer and had to transform into a public company overnight. As a subsidiary, our client had a history of restatements in its stand-alone financial statements. In order to be able to report as a public company, our client had to develop a finance infrastructure. Its reporting obligations included preparing registration statements and annual and interim reports to be filed with the SEC, creditor reporting and compliance with the provisions of the Sarbanes-Oxley Act of 2002.
Our approach: PwC initially deployed a specialist team at the client's offices to advise them on their financial reporting requirements and advise them on their resolution of various complex accounting issues such as purchase accounting, stock compensation, revenue recognition, implementation of new standards on uncertain tax positions and fair value accounting, and on achieving and maintaining (and later unwinding) hedge accounting. Our specialists also provided periodic technical accounting updates to the client's staff. Along the way, PwC also helped the company reorganize its finance infrastructure (remediation of organization structure, close calendar and tools and IT systems), select a treasury management system, establish its Sarbanes-Oxley compliance efforts and develop tax optimization strategies.
The outcome: Despite the very steep learning curve and through the coordinated efforts of PwC's specialists and the company's growing finance team, our client successfully transitioned to life as a public company. The knowledge transfer mechanisms that are an inherent part of PwC's service offering enabled the company to wean itself off consultants to become self-sufficient with regard to its routine accounting and financial reporting needs.
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