Regulatory agencies and auditors are increasing their focus on charges taken for stock-based compensation. This scrutiny is particularly intense when a company files to go public. And, of course, at no time would a restatement of reported earnings be as potentially disastrous as then a company is planning to go public.

Getting an outside, independent opinion of value for FAS 123R purposes as early as possible in the IPO process is crucial. Management and investment bankers need to determine if a "cheap stock" charge has to be taken. If so, they must communicate the charges to the market as early as possible.

For more information on our valuations of "cheap stock" for FAS 123R compliance, contact Pluris today.