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SEC Signals More SPAC Merger Accounting Concerns Arising

Sept. 30, 2021, 4:43 PM

The Securities and Exchange Commission is fielding more questions about accounting issues that crop up when private companies go public via merger with the blank-check companies that soared in popularity in 2020.

Unlike the accounting challenges that caused hundreds of special purpose acquisition companies (SPACs) to redo, or restate, their financial statements this spring, the challenges this time focus on the merger itself.

“While a variety of challenges may arise throughout the de-SPAC process, one area where target companies often encounter complex issues is in accounting for its merger with the SPAC,” said John Vanosdall, deputy chief accountant ...