A long-form report in an IPO is a private report by the reporting accountant on the company's business, finances, controls and key risks, typically addressed to the directors and to the sponsor (Main Market) or Nominated Adviser (AIM). It is not published.
For a scale-up, much of what investors are asked to pay for is intangible: the product and its code, proprietary data, customer relationships and the know-how of the team. Many of those assets are not on the balance sheet at all. The long-form report is where the reporting accountant asks how the business depends on them, how they are accounted for and how management keeps track of them.
This is UK practice, tied to the sponsor regime for the Main Market and the Nomad regime for AIM.
The long-form report is a private report prepared by the reporting accountant, the independent accounting firm the company appoints to report on its financial information and procedures for the listing. It is typically addressed to the company's directors and to the sponsor on the Main Market, or to the Nominated Adviser (Nomad) on AIM. It is not published.
Its purpose is to give the sponsor or Nomad, and the directors, an independent picture of the business and its finances. They use it to support their own due diligence and judgements.
The division of responsibility matters. The company prepares; the reporting accountant reports. The directors own the numbers, the forecasts and the procedures, and the long-form report sets out what the reporting accountant found when it examined them.
The long-form report is a private report by the reporting accountant, typically addressed to the directors and the sponsor or Nomad, on the company's business, finances, controls and key risks. It supports their due diligence before a UK listing and is not published.
The report typically covers the areas below.
| Area | What the reporting accountant typically examines |
|---|---|
| History and business | How the company developed and how its business model works |
| Management and organisation | The board, senior management and the structure of the business |
| Systems and controls | The financial systems and the controls around them |
| Financial reporting procedures and accounting policies | How the accounts are prepared and which policies are applied |
| Historical trading record | An analysis of trading results over the period reviewed |
| Net assets and cash flows | An analysis of the balance sheet and of cash generation |
| Taxation | The company's tax position |
| Key risks and issues | Matters the directors and the sponsor or Nomad should weigh |
The long-form report is one strand of due diligence before admission. Legal due diligence by the company's lawyers runs alongside it, and supports verification of the published admission document (AIM) or prospectus (Main Market).
For intangible assets the two due diligence strands meet. The reporting accountant asks how the business depends on its IP and how it is accounted for; the lawyers confirm that the company owns it. The evidence the company gives each of them should tell the same story.
The intangibles questions in a long-form report typically fall under five themes. Each asks what the business depends on and what evidence supports the answer.
The reporting accountant typically asks which intangible assets the business model depends on: the software platform, proprietary data, brands, customer contracts or licences. The answer frames the rest of the section, so it is best given as a list with a named owner for each asset, not as a narrative assembled for the meeting.
The report typically examines the accounting: the development capitalisation policy and how it is applied (see development costs under IAS 38), the treatment of intangibles acquired in past deals, and goodwill, including goodwill impairment testing.
The framework depends on the venue: the Main Market requires IFRS, and since August 2026 AIM allows IFRS or FRS 102. On any move to IFRS, development costs can be capitalised only where the company had both a documented assessment and cost tracking in place at the time; see IFRS 1 development costs.
The report typically looks at dependence on key people and key customers. On people, the questions concern key person risk: whose departure would matter, what retains them and whether their knowledge is written down. On customers, they concern how concentrated revenue is and what the contracts say if control changes.
The report typically asks how the company protects its know-how and data. For know-how, that means trade secrets and confidential information: confidentiality agreements, access controls and whether critical knowledge sits with a few people. For data, it means where the data comes from, under what licence, and on what UK GDPR basis the company uses it.
Finally, the report typically asks how management monitors these assets: whether there is a record of what the company owns, who is responsible for each asset and whether the board sees it. A company that answers from a maintained record shows the controls the question is probing; one that answers from memory shows their absence.
The intangibles questions in a long-form report are evidence questions. What does the business depend on, how is it accounted for, who holds it, how is it protected, and how does management know? A company with the answers in one maintained record answers them once.
The findings below illustrate what the intangibles section of a long-form report can raise. Each is easier to fix before the advisers arrive than during the process. For the general approach when an issue surfaces, see our FAQ on what to do if due diligence uncovers an issue.
| Area | Typical finding in the intangibles section | Fix before admission |
|---|---|---|
| IP ownership | A contractor-built module has no IP assignment | Obtain an assignment; align with legal due diligence |
| Development accounting | The capitalisation policy is applied without project cost codes | Introduce project codes; review the policy against IAS 38 or FRS 102 |
| Acquired intangibles | Past PPA workings cannot be found | Reconstruct the file from completion accounts and the valuation report |
| Goodwill | No recent impairment review supports the carrying amount | Prepare the review with forecasts tied to the business plan |
| Key people | Know-how is held by two engineers with no succession plan | Retention arrangements and documentation |
| Customer concentration | Top customers are not reviewed for change-of-control clauses | Contract review; risk-factor disclosure |
| Data | Data sources and licences are undocumented | Document sources, licences and UK GDPR basis |
Late findings cost time and negotiating position. A gap found during the process has to be fixed against the timetable, explained to the sponsor or Nomad, and may need disclosure as a risk factor. The same gap found early is housekeeping.
Preparation is the company's work, not the reporting accountant's. Five steps put the intangibles evidence in order before the questions arrive.
For the wider workstreams that sit around these steps, from venue and advisers to governance, see our IPO readiness checklist.
List each material intangible asset with its owner, legal form and supporting evidence in one record, kept current rather than assembled for the data room. A Value Drivers Register is one form of this record.
Collect IP assignments from founders, employees and contractors, registrations in the company's name and a schedule of licences, and close any gaps with the lawyers.
Document the capitalisation policy and apply it with project cost codes, put past PPA workings on file, and support any goodwill impairment review with forecasts tied to the business plan.
Record key people and succession plans, revenue by customer, change-of-control clauses in customer contracts, and the sources and licences behind the company's data.
Walk through the five themes with the finance team and the people who own each asset, so the answers given to the reporting accountant match the evidence on file.
IPO due diligence shares methods with due diligence on a sale, but the parties differ. In a sale, buyer-side intangible asset due diligence is commissioned by the buyer, while vendor due diligence is commissioned by the seller for bidders to read.
| Feature | IPO long-form report | M&A buy-side due diligence | Vendor due diligence |
|---|---|---|---|
| Who commissions it | The company, which appoints the reporting accountant | The buyer | The seller |
| Who relies on it | Typically the directors and the sponsor or Nomad | The buyer | Bidders, and in time the buyer |
| Public or private | Private | Private | Private, shared with bidders |
The evidence a company assembles for a listing is largely the evidence a buyer would ask for in a sale, so a maintained record serves either route. For the seller-side report, see the glossary entry on vendor due diligence (VDD).
In Opagio Intangibles, the Opagio Value Drivers Register™ records each intangible asset with its owner and evidence. Evidence levels such as "title-confirmed" and "DD-ready" show which assets still have gaps, so the company can see where it stands on each theme above before the reporting accountant asks.
For the wider exit picture, including a trade sale, see Opagio for exit readiness.
Opagio supports the company's preparation. The reporting accountant prepares the long-form report, and Opagio does not perform due diligence.
Keep each intangible asset, its owner and its evidence in one register, ready for the reporting accountant, the lawyers and the sponsor or Nomad. Book a demo of Opagio Intangibles.
No. The long-form report is a private report prepared by the reporting accountant and typically addressed to the directors and the sponsor or Nomad. It does not appear in the admission document or prospectus. Where required, the reporting accountant's report on the historical financial information is the published one.
Typically the company's directors and the sponsor (Main Market) or Nominated Adviser (AIM). It gives them an independent picture of the business and its finances to support their own due diligence and judgements. This is UK practice.
Typically the key assets the business model depends on; the accounting for them, including the development capitalisation policy, acquired intangibles, goodwill and impairment testing; dependence on key people and customers; protection of know-how and data; and how management monitors these assets.
Tony Hillier is Chairman of Opagio. He specialises in valuation, due diligence, accounting and structured finance, and previously worked at NM Rothschild and GEC Finance. Learn more about our team.
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