As accounting standards continue to evolve, more and more emphasis is being placed on “fair value” financial reporting. We offer the expertise to assist executive management and boards of directors of both private and public companies in satisfying their external audit requirements related to fair value financial reporting. Not only does our team have significant valuation experience, but we also have many years of experience as external auditors, as well. Accordingly, we have a deep understanding of how both management and external auditors view fair value and its impact on financial reporting.
When a business changes hands, there is often considerable value paid in excess of the target’s tangible assets. Such scenarios often indicate the existence in material intangible assets. Our team is able to assist companies and their auditors by determining the fair value of any intangible assets acquired in the purchase of a business to meet the necessary financial reporting requirements.
When companies issues stock options, a corresponding compensation expense must be recorded based on the options’ fair value. However, there is often not a readily observable market in the company’s options to set their value. Instead, it is often necessary to bring in a third-party valuation expert to determine the value of any options issued so that the corresponding compensation expense can be appropriately recorded on a company’s books. We are able to value stock options using auditable methods that help you satisfy your requirements under ASC 718.
Any company with goodwill on its books has had to deal with the annual impairment testing required by generally accepted accounting principles (GAAP). We are able to work with both company management and external auditors in a timely manner to perform an independent goodwill impairment analysis that satisfies the company’s financial reporting requirements.
Similar to goodwill impairment testing, any intangible assets on a company’s books must also be tested for impairment on an annual basis. This exercise is often a source of contention between companies and their external auditors. We work with all of the parties involved in preparing an analysis that can be relied upon in issuing financial statements prepared in accordance with generally accepted accounting principles (GAAP).
Whether determining the fair value of private equity portfolio companies or an ownership interest in a non-public entity held by your company, external auditors often require a third-party appraisal to support the corresponding values for such assets reported on a company’s balance sheet. Our professionals are able to efficiently perform these valuations to provide our clients with supportable values to record on their balance sheets.