Assume that you are a
CEO of a medium-sized company that needs a significant influx of cash for
several expansion projects. As the CEO, you must determine whether your company
should remain private or go public. Some companies postpone going public due to
the unpredictability of economic and market conditions. Consider the
ramifications of both alternatives. Construct an argument for and against going
public. Before providing your response, review the guidelines and regulations
associated with going public by visiting Small Business and the SEC located athttp://www.sec.gov/info/smallbus/qasbsec.htm.
Use the Internet to
research SOX law, located athttp://www.sarbanes-oxley-101.com/sarbanes-oxley-compliance.htm.
Write a four
page paper in which you:
Outline three (3) ways
in which your medium-sized private company may benefit from going public,
providing a rationale for each.
1. Create
an argument that the same goals may be achieved if the company remains a
privately held entity. Provide support for your argument.
2. When
a company decides to go public, it can typically obtain capital by issuing
stocks or bonds. Suggest four (4) leading financial ratios that will be
evaluated and how each will impact the company’s decision to obtain expansion
funds. Determine whether the results of the ratios would alter the decision to
go public.
3. By
researching the results of SOX compliance surveys, assess the financial impact
that SOX might have on your company if it decides to go public. Considering the
impact of SOX compliance, take a position as to whether your company can
overcome the challenges posed by SOX compliance if the decision is to go
public. Based on your research, support your decision by identifying the
potential advantages and disadvantages that SOX may have on your company.
Provide specific examples.
4. Make
a recommendation as the CEO regarding the alternative (i.e., going public or
staying private) that will best support the company’s expansion goals. Support
your position.
5. Use
at least four (4) quality academic resources in this assignment.Note:Wikipedia and other Websites do not
qualify as academic resources.
Your assignment must
follow these formatting requirements:
· Be
typed, double spaced, using Times New Roman font (size 12), with one-inch
margins on all sides; citations and references must follow APA or
school-specific format. Check with your professor for any additional
instructions.
· Include
a cover page containing the title of the assignment, the student’s name, the
professor’s name, the course title, and the date. The cover page and the
reference page are not included in the required assignment page length.
The specific course
learning outcomes associated with this assignment are:
· Analyze
financial reports, prepare analysis, and draw conclusions based on the
financial analysis.
· Calculate
and interpret various financial and operating ratios used in business.
· Use
technology and information resources to research issues in accounting
management.
· Write
clearly and concisely about accounting management using proper writing
mechanics.
