The following Corporate guidance note provides comprehensive and up to date legal information covering:
This Practice Note provides an overview of the purpose, content and scope of a comfort letter prepared by the auditors of a company preparing to offer its shares to the public in the context of a US initial public offering (IPO). Produced in partnership with Thomas France, a partner in the Corporate Transactional group of Venable LLP.
In connection with the due diligence process, the underwriters will obtain a 'comfort letter' from the company’s auditors regarding the financial information contained in the prospectus and registration statement. The underwriting agreement will require the company to procure the auditors to deliver the comfort letter to the underwriters as a condition to closing and the company will engage the auditors to prepare the comfort letter. Underwriters’ counsel typically will negotiate the content of the comfort letter directly with the auditors, but will keep the company and its counsel informed about the negotiation of the comfort letter and any issues that may arise.
The form and content of the comfort letter follows guidance contained in AS 6101 (formerly AU Section 634 and before that, the Statement on Auditing Standards number 72). In the comfort letter, the auditor identifies the financial statements of the company that it
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