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Initial Public Offering And Income Tax Article
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Initial Public Offering Process: How it is Done?
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In business, finance, and trade, process is an essential ingredient to complete the recipe of a successful commercial result. It typically involves inputs (pre-requisite data that must be entered before any method can be put into place), different methods, and outputs (the expected results once methods have been applied to the inputs).
In addition, it is a collection on interrelated structural activities that generates something of value for a corporate organization, its stakeholders, and/or its clientele. In other words, the process that a corporate organization will adopt will help them realized the services that they are offering to the public.
It works like a cookbook wherein the ingredients are prepared first before proceeding to the step-by-step procedure of cooking a particular dish or cuisine. Once the ingredients and the procedures have been satisfied, you will be able to arrive with a very delicious meal which you can enjoy. Such delicious meal represents the achievement of a corporate organization in terms of excellent delivery of products or services to the public and generated revenue for the company.
Process does not limit itself on corporate organizations. Even external matters require process in order to facilitate smooth flow of the application to the business community. One of which is the initial public offering.
Also referred to as IPO, initial public offering is the first or the initial sale of a company’s common shares to the public. It is primarily for raising additional capital or funds for a company that will be used to sustain its growing needs (production, distribution, and others). The term merely applies to initial issuance of common shares to interested public investors. Thus, any late issuance of common shares will be referred to as a secondary market offering.
The IPO process involves rules and regulations imposed under different governing laws and bodies, such as the Federal Securities Act of 1993 and the U.S. Securities and Exchange Commission, respectively. In addition, state laws affect the IPO process, though there are exceptions applicable especially of the common shares are listed with a major stock exchange such as the NASDAQ and the NYSE.
The process generally starts with the company selling the common shares to the public (the issuer) to draft a prospectus. Such prospectus contains the details about the company’s history, background, finances, offered products and/or services, industry environment, and other related information. The Securities and Exchange Commission actively scrutinizes the content of individual IPO prospectus before proceeding to approval. Companies going public typically employ the services of major law firms during the drafting process.
After the SEC approved the prospectus, the prices of the common shares are now finalized and the IPO will now be entered into a “free riding” period. The underwriters, which are composed of several investment banks, will now offer the common shares for sale to the public in various ways. All offers that will be made must have an accompanying copy of the approved IPO prospectus. Any misleading and false statements are strictly prohibited while the offering of common shares for sale within this period is going on.
The executives of the company going on public will be held responsible for any misleading information or omissions on the prospectus. In the same manner, the underwriters will also be held liable if they failed to conduct a reasonable investigation about such misleading information or omissions.
Initial public offering involves a process, which will keep IPO flowing smoothly and protected against individuals or groups who want to take advantage of the process itself.
Initial Public Offering And Income Tax Specific links
Initial Public Offering And Income Tax News
Groupon's Growing Pains - Wall Street Journal
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Zuckerberg's 2012 personal income tax bill: $1.5 billion - Register
 International Business Times | Zuckerberg's 2012 personal income tax bill: $1.5 billion Register If all goes according to plan, Facebook founder, chairman, and CEO Mark Zuckerberg's share of the profit in his company's upcoming initial public offering will result in him facing a tax bill of around $1.5bn for 2012. What's more, the Financial Times ... Facebook's Zuckerberg may face $2 billion tax bill Lawmakers sound caution on Facebook IPO tax revenue Big tax refund expected for Facebook |
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Roadrunner Transportation Systems Reports 2011 Fourth Quarter and Year-End ... - MarketWatch (press release)
Roadrunner Transportation Systems Reports 2011 Fourth Quarter and Year-End ... MarketWatch (press release) (1) Results for the year ended December 31, 2010 include a one-time loss on early extinguishment of debt of $15.9 million and $1.5 million of expenses related to the company's initial public offering in May 2010. "Revenues increased 43.6% and net ... |