Many companies have been working to interpret the SEC’s statement since its release in early April regarding the classification and accounting for warrants utilized by SPACs, two directors of advisory firm Opportune write in an opinion piece for Accounting Today.
The “Replacement of Securities upon Reorganization, etc.” section in many SPAC warrant agreements contains a seemingly never-ending sentence that stretches three quarters of the page, and the associated accounting guidance is equally challenging to interpret. Therefore, the technical complexities have led many to understand that there are issues, but they’re not always able to easily articulate exactly what these issues are.
Take a deep dive into the minutiae of SPAC warrants. Read more.
