NASDAQ, based in New York, USA, is one of the world’s leading stock markets and is particularly well known for the number of high-tech and growth companies listed on it. For example, world-class IT companies such as Google, Apple, Amazon and Microsoft are listed on NASDAQ.
More and more Japanese companies are listing on NASDAQ, but the reasons for listing on NASDAQ instead of the Japanese stock market are,
(i) Ability to raise capital on the world’s largest capital market.
(ii) Enhance global credibility and brand power
(iii) Expand business in the US market
(iv) Use as an EXIT strategy
(5) Easily receive recognition that is difficult to obtain in the Japanese market.
The following are some of the advantages of listing in the US market. Furthermore, it is possible to list on NASDAQ in a relatively short period of time compared to listing on the Japanese stock market, and this may be another reason.
In order to list on NASDAQ, there are the same criteria and rules to clear and comply with as for listing on the Japanese stock market.
For example,
- Financial reporting obligations in English (US GAAP and IFRS compliance) and audit compliance with financial statements
- Compliance with internal controls (SOX Act)
- Preparation for SEC (US Securities and Exchange Commission) compliance (e.g. S-1/F-1 preparation)
- Strict disclosure obligations and investor relations activities and more.
Many companies have never had their financial statements audited before, so it is not uncommon for them to spend a considerable amount of time and energy requesting a vast amount of documents from the audit firm, responding to questions about the audit, dealing with the audit firm in English, and preparing documents. The firm’s experience with NASDAQ is not limited to the audit of a company’s financial statements.
Our Office, who have extensive NASDAQ experience and have audited US companies locally in the US, can assist you in dealing with such audits in preparation for a NASDAQ listing. Please feel free to contact us for more information.