ASC Topic 805, formerly FASB 141(R), added several new challenges to the financial reporting of purchase price allocations and valuations based thereon.

One of the most controversial new features was the mandate to value and report contingent consideration payments on the acquisition, or measurement, date. We undertake a comprehensive analysis of target projections, financial conditions, working capital, and future operating needs to support detailed contingency payment analysis. Many of these aforementioned procedures comprise key components of intangible asset valuation analysis.   

Furthermore, our team of multidisciplinary experts applies real-world M&A experience to complement the core purchase price valuation procedures in an ASC 805 valuation opinion.

Core purchase price valuation procedures entails:

Determining the overall business enterprise value of the target to calculate goodwill or a bargain purchase (a.k.a. negative goodwill)

Identifying intangible assets distinct from goodwill

Valuing working capital and any inventory

Analyzing useful lives of major intangible assets to calculate the tax amortization benefit under IRS Section 197

Working with auditors and management to discuss review questions of our analysis. 

What is At Stake?

ASC 805 valuations establish a target's opening balance sheet and hence paint the new picture of total assets, liabilities, and equity from the closing date of the acquisition.

We prepare detailed financial reporting valuations, as well as assist company management in internal valuation support, for these inherently challenging assignments. 

How We Assist Clients

NAV's team deliver cost-effective and supportable valuation services such as internal valuation support, summary valuation reports, and detailed valuation reports. We also offer clients the flexibility to select their reporting option and shift service levels upward or downward during the engagement process. 

How We Are Transparent

We perform our services on a flat-fee or hourly basis with leading attorneys, alternative investment funds, CFOs, CPAs, and other C-suite corporate executives. We strongly feel engagement scope and fee ranges should be communicated effectively and efficiently.

We accordingly serve clients in stages, and we encourage clients to take a methodical, calculated approach to deciding which professional offerings are necessary or optional. 

Our first service stage is dubbed the NAV Situation Scan (TM). The Situation Scan helps both our clients and our teams diagnose the services necessary for fulfilment of client objectives. We then communicate the results of the Situation Scan to derive a suggested road-map. The NAV team next proposes a time frame for delivery of service milestones. We are inherently flexible, and our Situation Scans outline a proposed plan of action and not a mandatory obligation. We have found clients cherish this "ramp-up or ramp-down" flexibility that can be implemented at any time.