Do IPO prices have a basis in company fundamentals, or are they untethered from accounting realities? In this paper, Asher Curtis of the University of New South Wales, Andrew Lynch of Horwath Melbourne, and Julian Yeo, Assistant Professor of Accounting, Columbia Business School, analyze Australian IPO data from the 1990s to show that the connection is strong. Through a novel analysis, the paper uses a residual income valuation model, based on forward and trailing accounting indicators, as a basis for comparison with IPO values. In addition to concluding that accounting fundamentals have strong predictive power, the authors test additional variables that have been thought to influence IPO prices. Looking at information asymmetries, affiliations (through underwriters and auditors) and growth proxies, the paper finds strong support for the latter only.