Review issues professionals encounter in assisting clients who are selling or buying mid-size companies. Examine the accountant advisor's essential role in drafting and structuring purchase-price adjustment mechanisms, due diligence and accounting for transactions. Review considerations such as buyer/seller perspectives and preferences, letters of intent, significant components of definitive purchase agreements, and the high-level tax considerations of buyers/sellers-including the implications of Section 338(h)(10) elections. Explore the M&A process from non-disclosure agreements to post-closing operations, focusing on the CPA's role and ways to help clients.
Learning Objectives
- Recognize the M&A process and the accountant's role
- Determine how deal drivers present opportunities for client service
- Evaluate critical deal points and terms
- Determine how to plan and execute an effective due diligence process
Major Topics
- The purpose and role of financial due diligence in the deal process, including quality of earnings analysis, evaluation of forecasts and sustainability of cash flow
- Working capital adjustments and balance sheet due diligence
- The impact of contemplated pricing, earn-outs and holdbacks
- The deal timeline and flow of information
- Understanding the terms and structure that fit the buyer and seller objectives
- Tax and financial accounting treatment of select issues
