Kral Ussery LLC, Certified Public Accountants
TX Office: (817) 416-6842
NV Office: (702) 565-2727

Accounting & SEC Advisory

Offering advice and assistance on US GAAP and SEC regulatory matters:
  • Pre-Transaction GAAP Analysis
  • Technical Accounting Research & Memos
  • Pre-Filing Reviews of SEC Periodic Reports
  • IPO Preparedness
  • SEC Comment Letters
  • MD&As and SEC Disclosures

Pre-transaction GAAP Analysis

Entering into a complex transaction without an understanding of the accounting treatment could be disastrous for public companies. From embedded derivatives to beneficial conversion features and deemed distributions to contingent consideration, complex transactions could result in unexpected accounting and disclosure requirements that could burden a company for years to come. We have extensive experience in reviewing proposed transactions for potential accounting and disclosure implications and we can assist in structuring transactions so that the GAAP and disclosures align with the intent of each transaction.

Technical Accounting Research and Memos

Keeping track of the myriad of GAAP and SEC requirements and seemingly endless changes requires diligence and resources. We can fulfill or supplement the duties of the accounting policy group for companies in flux or that are too small for a full-time staff. Whether it is a one-time engagement to determine the proper GAAP treatment or SEC disclosures for a transaction, or you need a more complete resource for review of 10-Ks and 10-Qs for potential problem areas, or CPE training for your staff, we can fill the need for complex and new accounting standards.

Our diversified KU teams can focus on:

  • Migrating financial statements and disclosures to SEC compliant financial statements
  • Revenue recognition
  • Lease accounting
  • Derivatives and credit losses
  • Variable interest entities
  • Implementation of new accounting standards
  • Business combinations
  • Goodwill and goodwill impairments
  • Business combination purchase price allocations
  • Stock based compensation

Pre-Filing Reviews of SEC Periodic Reports

All public companies face rapidly changing and complex accounting in satisfying SEC reporting requirements. Many companies, especially smaller public companies, can benefit in having an independent advisor and reviewer on their team to comprehensively deal with financial reporting and SEC compliance matters. Sections 302 and 404 of the Sarbanes Oxley Act (SOX), and related SEC rules, require all public companies to commit appropriate resources to decipher and apply new accounting rules resulting in the preparation of complete, accurate, and timely SEC filings based on the foundation of strong controls.

We partner with public companies to accomplish SEC compliance objectives by providing;

  • detailed pre-filing desk reviews of 10-Qs and 10-Ks (all items, including the MD&A),
  • advice on remediating significant deficiencies and material weaknesses,
  • assistance in responding to SEC comment letters, and
  • other financial reporting and SEC compliance matters.
As an added measure, we can also serve on compliance and disclosure committees for our clients. We do not perform audit or other attest services so we are never in conflict with SEC independence rules. Kral Ussery offers a level of internal review and support to complement your controllership and compliance functions.

Some SEC registrants cannot justify full time quality review staff that are sufficiently up to date with current GAAP and SEC reporting rules. We perform this function in a cost-effective manner resulting in enhanced internal controls over financial and regulatory reporting. Our teams can also serve as an ongoing resource to address U.S. GAAP and SEC compliance issues raised by regulators and the external auditor.

IPO Readiness

An initial public offering (IPO) is one of the most challenging and rewarding transactions. A misstep in strategy, SEC reporting, accounting, governance, risk management, culture, or controls can be fatal. However, an effective transaction yields greater liquidity to shareholders and an increase company market value thus opening more expansion doors. Preparation and building a strong IPO team is essential. Consider KU on your IPO team.

There are several pros and cons in making the decision to take a company public. Once made, there are also considerations regarding which route to take. Options include;

  • a traditional IPO process,
  • special purpose acquisition company (SPAC) transactions,
  • going public as an Emerging Growth Company under the JOBS Act, or
  • taking a company through a reverse merger into a public shell.

Trusted advisors can help navigate the process, confront key decision points and hurdles, and pave the way to a successful transaction. A large part of the process is education and readiness on many fronts, including:

  • A realistic IPO timeline based on a readiness assessment
  • Streamlined requirements for an Emerging Growth Company
  • The external auditor's role
  • Structuring the board of directors with appropriate committees and independent directors
  • Financial statement requirements for SEC registrants
  • SEC Reg. S-X, which is an additional layer of financial reporting requirements on top of US GAAP
  • SEC disclosures, including the Management's Discussion and Analysis (MD&A)
  • Designing a healthy control environment to mitigate financial reporting and compliance risks
  • Modifying or enhancing technology capabilities to support changing work streams
  • Preparing the applicable SEC forms, including the S-1 registration statement
  • Addressing SEC comment letters
  • Preparing for life after the IPO or reverse merge event, including accelerated financial reporting requirements
The KU Team can educate, help prepare and even manage these fronts. Don't let a misstep derail your plans - contact us now.

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