ASC 805 (Formerly 141R)
Business combinations and asset purchases give rise to a number of financial reporting requirements for the stakeholders involved. Companies with GAAP based financial statements must comply with the guidance set forth in Accounting Standards Codification 805 (formerly SFAS 141R) recognizing and allocating all balance sheet items in an acquisition.
What is ASC 805? Accounting Standards Codification 805 (commonly referred to as 'purchase price allocation') provides guidance to allocate the premium paid above net book value in a merger or acquisition to both the tangible and identifiable intangible assets acquired in the transaction. Specifically, the fair values of acquired tangible assets or identifiable intangible assets are estimated and reported on the balance sheet. Any remaining amount is then reported as goodwill and tested for impairment annually in accordance with ASC 350.
Our Approach: Our team of experts uses valuation methodologies in accordance with AICPA, GAAP, and USPAP standards to come up with creative analytical solutions to support accurate valuations for tangible and intangible assets. We often work directly with the auditor to facilitate the review process and ease the time burden on management. Our work is highly regarded by the Big Four as well as regional accounting firms.
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