Standard Financial Reporting - Carta Release Notes - Product Updates

2 years ago6/6/2024

Standard Financial Reporting

Carta’s Financial Reporting tools automatically generate the expense and minimum disclosure reports that auditors need so that you can easily comply with US GAAP and IFRS 2 accounting standards.

Early-stage companies now have a Financial Reporting product designed just for them. Standard Financial Reporting includes automatic expense tracking for equity spending and an audit package with all the supporting evidence and documentation auditors need for stock-based compensation (SBC) expense reporting.

Features included:

• Automatic 409A valuations data ingestion
  • FMVs and Peers
• Annual reporting
• Audit package including SBC expense report, Minimum Disclosure report, and an audit guide detailing the assumptions we make and formulas we use
• Premier audit support
• Stock split support

Who is this available for?

Standard Financial Reporting is available to all Carta cap table customers, but specifically designed for early-stage companies preparing for their first few audits

Main Value Proposition

Automatically track your equity spending with Carta’s Standard Financial Reporting. Key benefits include:

1. Accurate, automated expense tracking: Tracks stock-based compensation expense, ensuring all cap table transactions are accounted for.
2. Time saved: Get your stock-based compensation (SBC) report, minimum disclosure report, and audit guide in 5-10 minutes, saving 1-2 weeks of manual calculations.
3. Compliance: Ensures compliance with the Financial Accounting Standards Board (FASB) requirements for booking SBC expense upon first issuance.
4. Historical expense calculation: Provides a one-time adjustment for historical expenses in your financial books.
5. Simplified auditing: Download an audit package with all necessary documentation, ready to send to your auditor.

In just a few clicks, Carta’s tool manages your stock-based compensation expenses, making your audit process seamless and efficient.

How do I use it?

• Go to Compliance > Financial Reporting
• Before getting started, make sure your cap table is up-to-date with all historical transactions including issuances, terminations, and cancellations.
• Click “Get started” and enter your financial statement end date. Then click “Generate expense.”
• Wait a few minutes while we do the complex accounting for you.
• Once expense is done generating, book your inception expense as a one-time adjustment in your financial books.
• Book your first FY expense in your financial book.
• When it’s time for your audit, download your audit package and send it to your auditor.
• If there have been any backdated adjustments made to your cap table, you can recalculate your expense before downloading your audit package for the most updated value.

Anything else I need to know?

All questions can be answered through our Financial Reporting support team, contact them via email 718@carta.com

Samantha Widman