In several instances, the knowledge gained from valuation support in the due diligence phase results in modifications or cancellations of transactions.
“We think private companies need to carefully consider whether they should adopt the PCC’s guidance.”
Under the PCC guidance, private companies can limit customer-related intangibles from other assets acquired in a business combination.
PJ Patel discusses the valuation requirements in a business combination.
A leading manufacturer of branded food products engaged VRC to estimate the fair value of certain intangible assets acquired in a business combination.
Golden parachute payments may be made to disqualified individuals contingent upon a change in control.
A large multinational consumer products company acquired a South American company operating in the same space. VRC was engaged to estimate the value of the PP&E and intangible assets for financial reporting purposes.
ASC 805 provides guidance for whether it is contingent consideration or compensation.
Auditors have increased scrutiny around management forecasts which provide the foundation for valuation methods based on an income approach.
Identifying and valuing intangible assets in advance of a purchase has become a valuable step in the due diligence process.