Technical valuation work that satisfies audit review and regulatory scrutiny — purchase price allocations, goodwill impairment testing, 409A opinions, equity compensation valuations, and tax-related appraisals for companies across Southern California.
Request a ConsultationFinancial reporting and tax valuations occupy a unique space in the valuation profession: they must comply with specific accounting standards or regulatory requirements, withstand audit review, and be delivered on timeline with the company's reporting cycle. The stakes are high — errors in purchase price allocations affect goodwill and intangible asset amortization for years. Unsupported 409A valuations expose companies and employees to significant tax liability. Goodwill impairment assessments directly affect reported earnings.
Our professionals have the technical background in accounting standards and tax regulations — combined with the valuation credentials and financial modeling depth — to deliver work product that holds up to auditor and IRS scrutiny. We work closely with the company's audit team and tax advisors to ensure our analysis is properly integrated into the financial reporting process.
Under ASC 805 (Business Combinations), an acquirer must allocate the total consideration paid in an acquisition to the identifiable assets and liabilities assumed — including intangible assets that may not have appeared on the target's balance sheet — with any residual allocated to goodwill. This purchase price allocation (PPA) must be completed within the measurement period following the acquisition and is subject to audit review.
The most judgment-intensive part of any PPA is the identification and valuation of intangible assets. We apply the appropriate valuation method for each asset class — relief from royalty for trade names and technology, multi-period excess earnings for customer relationships, cost approach for assembled workforce — and document our analysis in a form that satisfies auditor review.
When deal consideration includes earn-out or contingent payment provisions, ASC 805 requires these to be recorded at fair value at the acquisition date and remeasured each reporting period. We provide fair value opinions for complex earn-out structures, including probability-weighted scenario analyses and option-based models for milestone-contingent arrangements.
Under ASC 350, goodwill must be tested for impairment at least annually — and more frequently when triggering events suggest the fair value of a reporting unit may have fallen below its carrying amount. Under ASC 360, long-lived assets must be tested for recoverability when indicators of impairment are present. Both tests require independent fair value analyses that meet audit standards.
Section 409A of the Internal Revenue Code requires that stock options granted to employees be priced at or above fair market value at the grant date. For private companies, this requires a contemporaneous independent appraisal — commonly called a 409A valuation — to establish a defensible fair market value of the common stock. ASC 718 requires companies to measure the compensation cost of equity awards at grant date fair value and recognize this cost over the vesting period.
We provide IRS-compliant 409A valuations for early-stage companies through pre-IPO businesses, applying the appropriate equity allocation methodology for each stage of the company's development.
For financial reporting under ASC 718, we value stock options, restricted stock units, performance shares, and other equity-based awards at their grant-date fair value using models appropriate to the award structure.
Valuations of closely held business interests, family limited partnerships, and other assets for estate and gift tax reporting. Our reports comply with IRS requirements and are structured to withstand examination.
Built-in gains valuations, IRC §338(h)(10) election support, and tax attribute valuations for corporate restructuring and conversion transactions.
Fair market value support for intercompany transactions, management fee arrangements, and IP licensing between related entities.
We deliver financial reporting and tax valuations on schedule, coordinated directly with your audit and tax teams.
Contact Us All Services