Ipo Readiness Assessment

---
name: ipo-readiness-assessment
description: Produces an IPO readiness assessment covering audit history, controls, board composition, and KPI discipline, plus a gap list with an honest timeline, when you need to know whether a company can survive public-company scrutiny.
---

# IPO Readiness Assessment Agent

## When to use
Use this when a company is considering a listing and someone must say, without flattery, whether it is ready. Typical triggers: a board asking for a listing window, a sponsor testing IPO against a sale, or a company told it is twelve months away for three years running. Do it before the equity story, since a good story on an unauditable base fails in diligence.

## What it does
It produces a readiness assessment across five dimensions: audit history, the control environment, reporting capability, board and governance, and KPI definition discipline, closing with a gap list carrying an owner, a cost, and a duration per gap, and a critical path to a filing-ready state.

## Method
1. Count the audit runway. Establish what is actually audited.
   - Confirm how many years exist on the listing standard and by whom. A review is not an audit, and re-auditing an early year is a long-lead item.

2. Test the control environment. Assume the auditor will name every weakness.
   - Segregation of duties, entity-level controls, revenue cut-off, and IT general controls, each classified as a deficiency, a significant deficiency, or a material weakness.
   - A material weakness disclosed at listing is survivable; one found afterwards is not the same conversation.

3. Time the close. Public reporting runs on a clock.
   - Measure days to close and days to a reviewed quarter against the deadline the company inherits; a day-28 close with no review process will not support the first quarterly filing.

4. Assess the board and governance. Independence, committees, and clean-up.
   - Independent-director count against exchange phase-in rules, an audit committee with a designated financial expert, and removal of related-party arrangements that read badly in a prospectus.

5. Impose KPI definition discipline. Every metric becomes a promise.
   - Write a definition for each metric, name one owner, and require it to be reperformable from the ledger, reconciled to the nearest reported measure.
   - Recompute each KPI on an unflattering basis before an underwriter does; a metric that works only on a curated cohort gets restated in public.

6. Test forecasting capability. Guiding is harder than growing.
   - Review four to six quarters of budget versus actual. A company that misses its own plan by ten percent cannot credibly guide a market.

7. Check the plumbing. Cap table, equity comp, and systems.
   - Valuation history and cheap stock, option pool and post-listing burn, and whether the ERP can carry segment reporting.

8. Write the gap list and the honest timeline. Sequence what is parallel.
   - Give each gap an owner, a cost, and a duration, state the critical path rather than summing items, and say which gaps cannot close inside the desired window.

## Inputs
- Audited and reviewed financials with the auditor and standard per year
- The last close calendar and any auditor management letters
- Board composition with independence status and committee membership
- The KPI set with definitions and the calculations behind them
- Budget versus actual for the last six quarters
- Cap table, option pool, and the target listing venue and window

## Output format
- A readiness rating per dimension with the evidence behind it
- An audit history naming years, standard, auditor, and any re-audit needed
- A control findings list, each with severity and a remediation owner
- A governance section against the exchange's rules and phase-ins
- A KPI section with definitions, recomputed values, and restatement risk
- A gap list with owner, cost, duration, and the critical path to filing
- Present all schedules in prose, never as markdown tables

## Example
For Lattice Health (fictional, illustrative), two of the three required years are audited on the listing standard and the earliest was only reviewed, so a re-audit costing 1.4 million and running five months starts at once. Two material weaknesses are open, revenue cut-off and user access; remediation needs four months to design plus six months of operating effectiveness, and that ten months is the binding constraint. The close lands on day 28, workable, but no quarterly review exists, and the board of five has one independent director, so two more and a financial expert must be recruited. Net revenue retention is quoted at 118 percent on a cohort that excludes churned accounts below a size floor; on all accounts it is 106 percent, a 12-point gap to fix before the first draft registration statement, not after. Critical path to filing-ready is fourteen months: ten of remediation, then four of drafting and review, with the re-audit run in parallel.