Thanks to a 70-year-old provision in the Securities and Exchange Act, Google may be forced to move forward with an IPO, otherwise they would have to disclose closely guarded financial secrets.
Companies must report financial results to the SEC once they have at least $10 million in assets and more than 500 shareholders of record, including employees who hold stock options. Google’s profits are thought to be $100 million or more. And the assumption — reinforced by Google’s Web site, which touts “pre-IPO stock options” to prospective employees — is that the company has granted stock options to most of its more than 1,000 employees.
If those assumptions are true, then Google should have to start making quarterly filings to the SEC by April 30, which is 120 days after the close of its fiscal year.
Reporting companies must disclose the same information to federal regulators as publicly traded companies, including assets, liabilities, operating expenses and partnerships. But they do not trade their shares on the Nasdaq or New York stock exchanges.
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