Former SPACS Report More Financial Red Flags Than Other Firms

The securities filings for companies that went public via SPAC include far more financial reporting red flags such as internal control weaknesses and going concern warnings than other public companies, according to a report Thursday from investment research software firm Bedrock AI.

Almost half of the annual and quarterly financial filings of 314 companies that went public via special purpose acquisition companies reported material weaknesses or ineffective controls in their financial reporting between Jan. 1 2020 and the present. That compares to 20% of the 10-Ks and 10-Qs of all public company filings containing the same disclosures, according to ...