Every de-SPAC has a closing day: the bell, the new ticker, the press release. It feels like graduation. In practice, it is closer to the midterm. The final exam arrives a few months later, when the company files its first annual report as a public operating business and an independent auditor signs an opinion on a full year of results.

As an auditor, I have signed a lot of those first opinions. The one that follows a de-SPAC is always the hardest.

That report is where the deal's assumptions meet the public record. It shows whether the cash raised at closing will last, whether a finance team built for a private company can keep pace with SEC reporting, and whether the company can file on time.

So, we graded the exams.

The class was not Ivy League material. More than half disclosed substantial doubt about their ability to continue as a going concern. Three in four disclosed a material weakness. One in seventeen never turned in the paper.

My team matched every de-SPAC that closed between January 2022 and December 2025, 316 deals according to SPACInsider, to its filings on EDGAR. We pulled each company's first annual report after closing, on Form 10-K, 20-F, or 40-F, along with every late-filing notice, auditor change, and non-reliance notice filed in the following 18 months. Of the 316, 297 have filed that first report. The other 19 never did.

One piece of industry lore first.

Nearly every SPAC includes going-concern language in its financial statements because it must complete a deal or liquidate by a fixed date. Deal teams tend to treat that language as a feature of the shell that disappears at closing, when the trust cash arrives. However, the public record does not bear that assumption out.

In 53% of first annual reports, the combined company disclosed substantial doubt about its ability to continue as a going concern, and in 45% the auditor's report carried a going-concern paragraph. For most of these companies, the warning did not go away at closing. It simply shifted to the post-combination public company.

The Exam Results

Going-concern doubt was not the most common finding.

Three of every four companies (75%) disclosed a material weakness in internal control, either current or recently remediated, and 55% concluded that their disclosure controls were not effective at year-end. The results also worsened as the boom faded. Going-concern disclosures rose from 41% of companies that closed in 2022 to 57% in 2023 and roughly 60% in each of 2024 and 2025.

Filing on time proved just as hard. Within 18 months of closing, 39% of companies filed at least one notice that a 10-K or 20-F would be late. Among U.S. domestic filers, 27% changed auditors again more than four months after closing, and 22% filed an 8-K stating that previously issued financial statements could no longer be relied upon.

The Ones Who Never Sat the Exam

Nineteen companies, about 6% of the class, never even sat the exam.

One was acquired. Most of the rest went bankrupt, liquidated or delisted before the report came due. Among them were Fast Radius, Quanergy, Starry, Kalera, Near Intelligence, Electriq Power, Next.e.GO, Nuvo Group and iLearningEngines. These were not small deals. Starry, iLearningEngines, Quanergy and Fast Radius were each valued at roughly $1 billion or more when their deals were announced.

Cash Buys Time

The single best predictor of a going-concern warning was the amount of cash the company had on closing day.

Median cash at closing, meaning trust money left after redemptions plus PIPE and other financing, fell from $151 million for 2022 closings to $45 million in 2023 and about $20 million in 2024 and 2025. Median redemptions rose from 92% to 98–99%. More than half of the deals closed in 2024, and 2025 delivered less than $25 million to the company.

Going-concern rates track that cash closely.

Among companies that closed with less than $25 million, 63% disclosed substantial doubt in their first annual report. For companies above $250 million, the figure fell to 27%.

Deals with redemptions of 98% or more carried the warning two-thirds of the time, versus about 42% for the rest. Biotech, where cash burn runs ahead of revenue by design, came in at 75%.

Material weaknesses correlated far less with capital raised: between 66% and 81% of companies disclosed one at every cash level. A PIPE can fix a balance sheet, but it cannot install a working financial close.

The Accounting File

For readers outside the accounting trenches: under U.S. GAAP, management must assess at every reporting date whether conditions raise substantial doubt about the company's ability to meet its obligations within one year after the financial statements are issued. If such doubt exists, the company must disclose that its ability to continue as a “going concern” is uncertain, and the auditor adds a going-concern paragraph to its report if, after considering management’s plans, substantial doubt remains. IFRS reporters use a similar test and describe the result as a "material uncertainty."

A material weakness is an internal control deficiency serious enough that there is a reasonable possibility a material misstatement will not be prevented or caught in time. A significant deficiency is the same problem at a lower severity.

1. The runway is calculated on committed cash. Management's plans can count toward alleviating going-concern doubt only when it is probable they will be carried out. Financing that depends on future share prices or on investors who have not signed rarely meets that bar. A company that closes with $15 million and a $3 million monthly burn rate has a going-concern problem on day one, regardless of what the deck says about the follow-on raise.

2. Material weaknesses come from the same few places. Reading the disclosures, segregation of duties and complex or non-routine transactions each appear in nearly half of the cases. Those transactions include warrants, earnouts, convertible notes, and the merger accounting itself. A shortage of qualified accounting staff appears in more than four in ten, the period-end close in about a third, and IT general controls in about one in five. Most of these trace back to finance teams that were the right size for a private company but hadn't invested in the talent required for public-company reporting.

3. The deadline is unforgiving. Most de-SPACs file as non-accelerated filers, with 90 days after year-end to file a 10-K. Foreign private issuers get four months to file a 20-F. A notice of late filing buys 15 more days for an annual report. When nearly four in ten companies are using that notice in their first 18 months, the close was never rehearsed. Late filings also trigger exchange deficiency notices and can make a company ineligible to use shelf registration statements.

4. Auditor changes and restatements are expensive. Auditor changes at closing are routine because the SPAC's auditor usually hands off to the target's auditor. A second change in the following year, which happened at 27% of U.S. filers, means a new firm learning the business in the middle of the first public-company cycle. Non-reliance notices, at 22%, mean restating results the market has already priced in and can lead to shareholder lawsuits.

Foreign private issuers fared somewhat better on going concern (45%) and similarly on controls: 76% disclosed a material weakness.

What The Auditor Sees

Very few of these outcomes were surprises. Most were visible in the redemption count on closing day and in the size of the finance team on the organization chart. That argues for doing three things before the vote.

1. Run the going-concern analysis at the expected redemption level, using only committed financing, and update it each time the redemption estimate changes. If the company fails the test at the expected redemption level, fix the capital plan before closing, not in the 10-K.

2. Build the public-company finance function before the bell. That means a controller who has closed a public-company quarter, enough staff to separate duties, technical support for warrants, earnouts and convertibles, and a dry run of the first quarterly close.

3. Map the first year's calendar: the Super 8-K, the first 10-Q, the first annual report and the auditor transition. The handoff between audit firms should not land in the middle of year-end fieldwork.

These are the same disciplines behind the twelve audit questions for sponsors choosing an auditor, the six warning signs that show up before a deal dies, and the SEC comment letters that show what the regulator tests during review. The first annual report is where all three get graded.

The Encouraging Part

Plenty of companies pass. Well-funded de-SPACs such as Getty Images and Pagaya filed first annual reports with effective disclosure controls and no going-concern doubt. A material weakness, meanwhile, is a remediation project, not a final grade. Core Scientific's first 10-K carried both flags; it went through Chapter 11 and came out the other side, still filing. The exam can be retaken. It is just cheaper to pass the first time.

The class of 2026 also looks different. So far this year, 37 de-SPACs have closed. Median redemptions are back to 91%, median cash at closing is about $110 million, and only 16% of deals delivered less than $25 million, close to the 2022 profile. These companies sit for their exam in early 2027. Better funding should move the going-concern number. The controls number will move only if management teams decide it should.

That matters because SPACs have become the route to market for frontier businesses: quantum computing, nuclear fusion, biotech, critical minerals. Those companies carry real scientific and operational risk, and investors accept it for the upside. Financial-reporting risk is different. It is not built into the business. It is a choice about preparation, and it is the one risk a management team can take off the table before the bell.

At MBP Global and MarcumAsia, we work with SPAC sponsors, target-company CFOs, audit committees, and de-SPAC management teams on exactly these questions, well before the first annual report is due. If you want to talk through your situation, reach out directly.

Drew Bernstein is co-chairman and co-founder of MBP Global and MarcumAsia. He has spent his career auditing cross-border and capital-markets transactions.

Methodology: Deal universe, closing dates, redemptions, and cash at closing from SPACInsider (316 de-SPACs closed January 2022 through December 2025; 37 closed in 2026 through October 1). Filings matched on SEC EDGAR. Going-concern, material-weakness and disclosure-control findings come from keyword review of each company's first annual report covering a period after closing, with sample verification by MBP Global; material-weakness counts include weaknesses disclosed as recently remediated. Auditor-change and non-reliance rates cover U.S. domestic filers only; auditor changes count 8-K Item 4.01 filings between four and 18 months after closing, which excludes the auditor transition at closing.