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Valuation

Why Us

When companies require an objective and independent assessment of value, they look to Armanino.

Our finance and accounting expertise, combined with our use and development of sophisticated valuation methodologies, fulfills even the most complex financial reporting and tax requirements. We constantly monitor changing regulations from the Financial Accounting Standards Board as they develop implementation guidance and new financial reporting rules with valuation implications. Armanino performs tax valuations and related consulting in accordance with the regulations and guidance established by the Internal Revenue Service and other taxing authorities.

Armanino's specialty is valuing technology businesses and technology-centric assets. To determine value, our professionals analyze each client’s business and financial plans, history, projections, and comparable companies and transactions. We have been engaged by more than 1,000 clients to value securities and assets for tax, financial reporting, business combinations, and litigation purposes. Our valuation opinions are fully defensible and documented to withstand scrutiny from the IRS, SEC, financial auditors, or other regulatory bodies.

Tax valuation and IRC 409A

Under IRC 409A, privately owned companies are required to establish that stock options are not being issued below fair market value at the time granted—a potential tax liability for both the company and the employee. Companies either considering or currently issuing stock options or SARS should have an independent IRC 409A valuation—no less frequently than once every 12 months or more frequently if their Board believes there has been a positive change in the business which could result in a change in the implied market value of the security subject to the grant. (Typically this includes events such as new rounds of financing, achieving key milestones, or hitting certain financial targets.) Make sure your valuation is up-to-date prior to granting equity compensation awards.

Financial reporting valuation and ASC 718 (SFAS 123R)

ASC 718 [previously SFAS No. 123(R)] mandates that companies must expense stock options and other forms of equity based employee compensation. Among other things, they must provide the basis for the value of the equity (often an independent valuation), track all equity compensation activity, calculate fair value, and adjust financial statements accordingly. Depending on the number of employees receiving awards, the frequency of grants, and the variability of the terms, ongoing administration and compliance can pose a significant burden. Armanino has in-depth expertise in determining the underlying security’s value, performing the  ASC 718 calculations and administering a Company’s cap table.

Estate and gift taxes

We assist taxpayers and their advisors with planning for estate and gift taxes.  Our gift and estate tax-related services include business enterprise valuations, capital stock valuations, tangible-asset valuations and intangible-asset valuations. We maintain compliance with the leading gift tax codes, providing quality appraisals by qualified appraisers. We are skilled in determining appropriate minority and marketability discounts for partial stock interests, insuring accurate valuation of the interests.

Business combinations, purchase price allocation & goodwill impairment

We provide a multi-disciplinary approach to helping clients in the merger or acquisition of a business. From due diligence to tax implications to accounting for and valuing the assets, our team will work with you to understand the transaction, the business acquired, and meet your compliance needs throughout the M&A process.

ASC 805 specifies that the accounting for an acquisition must identify the fair value of all assets acquired and liabilities assumed as of their acquisition date. Independent valuations for  purchase price allocations insure compliance with these accounting rules when you acquire a business or assets. Further, ASC 805 requires any equity compensation awards assumed or granted as part of the deal, be valued at fair value on the acquisition date.

Once the assets from a merger or acquisition are on the books, ASC 350 requires companies to use a process to measure the impairment of goodwill.

Valuation of derivatives

ASC 815, Accounting for Derivative Instruments and Hedging Activities, provides guidance on the specific accounting treatment of a multitude of derivative instruments, including convertible debt or warrants. The valuation of these derivative instruments typically depends on their classification and accounting consequences, which impact the complexity, often requiring advanced valuation techniques to calculate their embedded features. Armanino has experience in determining the proper accounting, and in the modeling of complex securities (including lattice and Monte Carlo), providing clients with an independent valuation to support financial reporting requirements.

Services

 

409A Valuations

409A Valuations

Armanino provides independent third-party valuations for IRC 409A and ASC 718 compliance. To determine value, our professionals analyze each client’s business and financial plans, history, and projections. We use in-house resources that understand the whole valuation process. We value more than 250 companies a year located around the world for tax, financial reporting requirements, and other purposes.

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ASC 718/FAS 123R

ASC 718/FAS 123R

Armanino provides independent third-party valuations for IRC 409A and ASC 718 (previously FAS 123R) compliance. To determine value, our professionals analyze each client’s business and financial plans, history, projections, and comparable companies and transactions. We have been engaged by more than 1000 clients to value securities and options for tax, financial reporting, litigation, and other purposes.

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Estate and Gift Tax

Estate and Gift Tax

Armanino has expert Qualified Appraisers who provide Qualified Appraisals for gift and estate tax purposes. We assist taxpayers and their advisors with planning for potential application of these taxes, in compliance with Internal Revenue Service codes.

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Valuations related to Mergers & Acquisitions

Valuations related to Mergers & Acquisitions

Armanino provides purchase price allocation valuations for compliance with ASC 805 and ASC 350 accounting rules. These valuations estimate the fair value of intangible assets, goodwill, liabilities, and contingencies.

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Derivatives

Derivatives

Armanino has advanced modeling capabilities to provide companies with the independent valuations of derivatives needed for financial reporting requirements and SEC compliance.

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Clients

Armanino has helped more than 1000 clients to value securities for tax, financial reporting, business combinations, and litigation purposes. Below is a list of selected valuation engagements.

  • Business Products/Services
  • Clean Tech
  • Consumer Products/Services
  • Enterprise Software
  • Entertainment
  • Financial Services
  • Food & Beverage
  • Internet Services
  • Life Sciences
  • Semiconductors
  • Specialty Channels
  • Telecommunications
  • Transportation

Resources

How-to Guide: Walking your Board through a 409A Valuation of Total Equity

To avoid expensive tax liability for your privately-funded company, and more importantly, your employees, ensure your Board of Directors has the tools to properly understand the valuation process.

As Easy as 1, 2, 3: M&A Goes Smoother with a Financial Expert on Your Side

Mergers and acquisitions (M&A) transactions can be daunting endeavors for both buyers and sellers.

What’s your Company Worth? A Business Valuation Can Achieve Many Objectives

There are a myriad of reasons to conduct a business valuation. The main reason is in preparation for selling your manufacturing or distribution business.

IPO Readiness: Why Now?

Getting your company ready for an IPO isn't easy, nor is it cheap; in fact, it's disruptive and takes people out of their comfort zones. But that's exactly why you should consider preparing for the IPO well in advance ...

“Fair Value” in a Troubled Economy

There’s no question that the struggling economy has had a negative impact on the value of many businesses and investments. But it also influences the business valuation process itself.

Planning on M&A Activity

What you need to know now to help guide you through FAS 141(R), 142 and 144 as well as other best practices.

No public company wants to face the time and expense, as well as the negative investor and ...

Avoid Noncompliance Penalty; What You Need to Know About IRC Section 409A

Enron executives accelerated the payments under their deferred compensation plans in order to access the money before the company went bankrupt. Internal Revenue Code Section 409A was enacted, in part, in res ...

FASB Expands Fair Value Disclosures

On January 21, 2010, FASB issued Accounting Standards Update (ASU) 2010-06, Improving Disclosures about Fair Value Measurements. The ASU reports on new disclosure requirements — and clarifications of existing re ...

Fair Value Now A Bit More Fair

FAS 159 allows companies to reduce volatility offerings

In February 2007 FAS 159, "The Fair Value Option of Financial Assets and Financial Liabilities" standard was released, and with it a way to account for f ...

Experts