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SEC repeatedly pressed Zynga for revenue details

The SEC today releases an exchange of letters in which it presses Zynga to disclose more details about its revenues.

Zynga CEO Mark Pincus (middle) when the company went public

This isn't the sort of news investors like to see from a newly public company.

The SEC today disclosed six emails it exchanged with Zynga in which the government prodded the social-game maker for specifics about its financials before letting it go public.

Zynga, the maker of FarmVille and CitiVille, raised $1 billion when it went public in December, becoming the biggest Internet IPO since Google.

A key concern for the SEC was just how many people were paying to play Zynga games and how Zynga was accounting for that revenue.

In a letter dated October 7, SEC special counsel Maryse Mills-Apenteng spells out the issue clearly and asks Zynga's CFO for a detailed analysis:

[We] continue to believe that the number of paying players and the average amount each spends is important information to the users of your financial statements since this will be a critical component of your future growth. ...Provide us with an analysis of your paying players, if you are able to determine such information.

She requests the same data again on October 28th.

The first letter from the SEC is dated July 28th, and Zynga subsequently revised its S-1 filing. Among other changes, Zynga added details about how many players pay to play (less than 5 percent).

Zynga was only founded in 2007, but the road to its IPO was long and bumpy--and these letters confirm why. The SEC took issue with Zynga's non-traditional accounting methods and forced the company to make changes to comply with accepted principles.

Zynga went public at $10 a share, and the stock briefly rose above that price on day one. But while CEO and founder Marc Pincus said the company got what it wanted, those who bought the stock after it went public are likely less pleased.

A Zynga spokeswoman declined to comment to CNET.

Zynga has traded below its offering price since going public in December.