(a) The decision of going public by a company is considered to be a complex decision that requires careful consideration and planning as it requires additional obligations and reporting requirements. State any two such obligations and reporting requirements.

Question

Accepted Answer

Two obligations and reporting requirements when going public are:

1. **Increasing accountability to public shareholders:** Once a company goes public, it becomes answerable to a large number of shareholders. The management must regularly disclose financial results, operational performance, and any material events that may affect the company's value.

2. **Need to maintain dividend and profit growth trends:** Public companies face pressure from shareholders to consistently deliver growing profits and regular dividends. Any significant decline in profitability or suspension of dividends can lead to a fall in share price and loss of investor confidence.