May 19, 2020

What You Should Know About IPOs

money matters
initial public offering
tina samuels
Bizclik Editor
4 min
What You Should Know About IPOs

The September edition of the Business Review USA is now live!

By: Tina Samuels 

In terms of the stock market, many terms go unnoticed by anyone who isn’t into business or investing, but IPO has become more popular recently. This is largely due to major companies going public with their initial public offering (IPO), such as Facebook. If you are still unsure what IPO is or how it affects you, here is some information.

What are IPOs?

An IPO is an initial public offering, or the launch of a company entering the stock market. This is when a company “goes public” and offers their first stock offering on a securities exchange. When this happens, a company officially goes from being a private company to a public company. In general, companies choose to do this so they can earn more capital and have the potential for growing even bigger.  You can either buy a share in the public company, or get it as a stock option if you work for that company or the share is part of compensation.

Why Companies Offer Stock Options

There are two primary reasons a company chooses to go public and begin offering stock options. One reason is because it is less expensive than giving cash or issuing other forms of compensation. They are saving money by offering individuals a share in their company, which can further improve their own assets if the company does well. The other reason is because stock options have more abilities to be controlled. This includes restrictions on when they are eligible to be purchased, transferred or other behaviors of stocks. They are typically offered to management within the company, such as being included in an executive compensation package. It keeps the company from paying high bonuses, and offering stock options in place of them.

What to Look For

If you’re interested in investing in an IPO, there are some things to look out for. First of all, try to invest in a new IPO, otherwise the amount continues to go up for those options. Here are some things to look for and know you’re making a good choice.


First is the history of the company. If they have been around less than a year and are already going public, you might want to think twice. It is not uncommon for innovative products and their company to get popular fast, growing at a rapid pace. But stocks for new companies are a big risk. Yes, they could be the next Facebook, but they could also go downhill just as fast as they went up. Included in their history is who their underwriters are and what bank is handling their investments.

Lock-up Agreements

It is not uncommon for new public companies to have a steady rate, then stocks going down rapidly after a few minutes. This is the lock-up period. When employees or investor sign stock options, they are also permitted to sign a lock-up agreement. This is a contract that keeps you from selling or trading stock within this period of time. The stock usually goes back up after this lock-up period.


You may also be interested in flipping IPO stocks. This can only be done with a hot stock and is a good way for quick profits. But you should do your research and be completely comfortable with it before continuing with flipping. Flipping involves reselling your stock with the first several days after buying into it, but you have to be aware of stipulations or restrictions of the stock first. If you got it as a stock option from your employer, it isn’t going to be an option for you.

Be Wary of Underwriters

The stock underwriter is essentially trying to make a sale, so don’t fall for their hype and be wary of one attempting to oversell an IPO stock. An IPO only occurs one time for every company, meaning the underwriter really lays on this fact heavily. You shouldn’t buy it just because it’s once in a lifetime for this new company as it won’t always do well.

If you’re new to investing in stocks or IPOs specifically, get advice from an experienced financial advisor. They will help you understand what you’re investing in and the different restrictions of IPO’s.

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Jun 8, 2021

Six issues at the top of tax and finance leaders’ agenda

Kate Birch
4 min
As businesses accelerate their transformation journeys, tax leaders are under increasing pressure to add strategic value. Deloitte reveals six tax trends

New Deloitte research reveals that tax leaders are under increasing pressure to add strategic value as companies accelerate business model transformation, from undergoing digital transformations to rethinking their supply chains or investing in green initiatives.

According to Phil Mills, Deloitte Global Tax & Legal Leader, to “truly deliver value to the business, the tax function needs to rethink its resourcing model and transform its technology infrastructure to create capacity and control costs”.

And the good news, according to Mills, is that tax and business leaders have more options at their disposal to achieve this.

Reflecting the insights of global tax and finance executives at global companies, Deloitte’s Tax Operations in Focus study reveals the six issues at the top of tax and finance leaders’ agenda.

Trend 1: Businesses seek more strategic counsel from tax

Companies are being pushed to develop new digital products and distribution channels and accelerate sustainable transformation and this is taking them into uncharted tax territory. Tax leaders say their teams must have the resources and skills to give deeper advisory support on digital business models (65%), supply chain restructuring (49%) and sustainability (48%) over the next two years. This means redrawing the boundaries of what tax professionals focus on, and accelerating adoption of advanced technologies and lower-cost resourcing models to meet compliance requirements and free up time.

According to Joanne Walker, Group Tax Director, BT Group PLC, "There’s still a heavy compliance load today, but the vision for the future would be that much of that falls away, and tax people become subject matter experts who help program the machine, ensure quality control, and redirect their time to advisory activity.”

Trend 2: Tipping point for resourcing models

Business partnering demands in the tax department are on the rise, but 93% of tax leaders say their department’s budget is remaining flat or falling. To ensure that the tax function can redefine itself as a strategic function at the pace that is required, leaders are choosing to move increasing amounts of compliance and reporting to a combination of shared service centers, finance departments, and outsourcing providers that have invested in best-in-class technology.

Trend 3: Digital tax administration is moving faster than expected

in addition to the rising focus of the corporate tax department partnering with their business counterparts, transformative changes to the way companies share tax information with revenue authorities is also creating an imperative to modernize operations at a faster pace. Nine in 10 (92%) respondents say that shifting revenue authority demands on digital tax administration will have a moderate or high impact on tax operations and resources over the next five years—and several heads of tax said the trend is moving faster than expected.

"It’s really stepped up in the last couple of years," says Anna Elphick, VP Tax, Unilever. "Tax authorities don't just want a faster turnaround for compliance but access into a company’s systems. It's not unreasonable to think that in a much shorter time than we expect, compliance will be about companies reviewing a return that's been drafted by the tax authorities."

Trend 4: Data simplification and lower-cost resourcing are top priorities

Tax leaders said that simplifying data management (53%) and moving to lower-cost resourcing models (51%) must be prioritized if tax is to become more proactive at delivering strategic insights to the business. Many tax teams are ensuring that they have a seat at the table as ERP systems are overhauled, which is paying dividends: 56% of those that have introduced NextGen ERP systems are now highly effective at supporting the business with scenario-modeling insights. Only 35% of those with moderate to low use of NextGen ERP systems said the same.

At Stryker, “we automated the source P&L process for transfer pricing which took a huge burden off of the divisions," says David Furgason, Vice President Tax. "Then we created a transfer price database to deposit and retrieve data so we have limited impact on the divisions. We are moving to a single ERP platform which will help us make take the next step with robotics.”

Trend 5: Skillsets are shifting

Embedding a new data infrastructure and redesigning processes are critical for the future tax vision. Tax leaders are aligned — data skills (45%) and technology process experience (43%) are ‘must have’ skills in a tax department of the future, but more traditional tax specialist knowledge also remains key (40%). The trick to success will be in tax leaders facilitating the way these professionals, with their different backgrounds, can work together collectively to unlock lasting value.

Take Infineon Technologies, which formed a VAT technology and governance group "that has the right knowledge about how to change the system to ensure it generates the right reports", according to Matthias Schubert, Global Head of Tax. "Involving them early was key as we took a greenfield approach, so we could think about what the optimal processes would look like and how more intelligent systems could make an impact 

Trend 6: 2020 brought productivity improvements

Improved productivity (50%) and accelerating shifts to remote working (48%) were cited as the biggest operational benefits to emerge from COVID-19-driven disruption. But, as 78% of leaders now plan to embed either hybrid or fully remote models in the tax function long term, 34% say maintaining productivity benefits is a top concern. And, as leaders think about building their talent pipeline and strengthening advisory skill sets, 47% say they must prioritize new approaches to talent recognition and career development over the next two years, while 36% say new processes for involving tax in business strategy decisions must be established.

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