Services
We provide services for financial reporting, tax, planning and other purposes
OBV Advisory help public and privately entities, private equity and venture capital firms successfully manage their financial reporting valuations. CFOs and corporate controllers rely upon our services to manage their financial reporting work. Our professionals offer a mix of finance and accounting expertise in financial reporting methods and regulatory requirements under U.S. GAAP, IFRS, the FASB and others. It is necessary to rely on an independent valuation partner to provide objective and supportable conclusions that comply with these standards and requirements.
Purchase Price Allocation
When preparing for or after closing an acquisition, companies must follow accounting guidelines and tax treatments. For example, under Accounting Standards Codification 805 (ASC 805), an acquirer must recognize any assets acquired and liabilities assumed, and any non-controlling interest in the acquiree at the acquisition date, measured at fair value as of that date. Assets most commonly meeting the identification criteria include tangible assets, such as real and personal property, and intangible assets, such as trademarks, technology and customer relationships. Other items that are regularly valued for allocation purposes include inventory, deferred revenue and contingent consideration. In some cases, the acquirer must also allocate the purchase price to various legal entities.
Under purchase price allocation accounting, OBV Advisory provide opinions of value for intangible assets, inventory, liabilities, contingent consideration and equity interests.
Impairment
Economic conditions can have a significant impact on valuations. In the impairment test, which should be performed at least annually and potentially in interim periods if there is a triggering event, the fair value of the reporting unit or long-lived asset is compared with the carrying amount.
OBV Advisory have solid experience with valuations of both reporting units and long-lived assets for impairment testing purposes.
Debt and Equity Securities
For debt securities, even if there are no quoted market prices, a reasonable estimate of a fair value can be calculated by using a variety of pricing techniques such as discounted cash flow analysis, matrix pricing, option-adjusted spread models, and fundamental analysis. Fair value estimates for credit and/or debt securities must account for the economic features of these securities that may shape future cash flows. Other credit and/or debt securities with dependent-state features often include floating and fixed-rate loans, first- and second-lien loans, and secured and unsecured mezzanine debt.
When startups or private companies issue equity compensation to employees they must expense the grant date fair value of the compensation through the income statement. Completing an equity compensation analysis may also require a business enterprise valuation of the company. OBV Advisory value equity securities with economic rights relating to preferred stock, warrants and LLC profit interests. We apply option pricing, taking into account specific capital structure and distribution rights. OBV Advisory have also valued various forms of equity-based compensation including stock options, profit interests, employee share purchase plans, restricted stock awards and others.
Intellectual Property
Intellectual property (IP), the exclusive rights held by an inventor or a producer of creative work, can be among the most valuable assets of a corporation. IP can include patents, trademarks, trade secrets, copyrights and other assets. The need for an independent valuation of IP can be driven by a variety of transactions and situations: mergers and acquisitions, negotiations of licenses, divestitures, spin-offs, bankruptcies and restructurings, litigation, collateral for financing, transfer pricing, financial reporting, tax planning and other compliance needs.
Our professionals have valued a wide variety of intangible assets including but not limited to: patents, technology, customer relationships, copyrights and content, supplier agreements, licenses and royalty agreements, non-competition agreements, brands, trademarks and trade names, software.
Our experts can determine appropriate valuation discounts, assess fair market value and develop valuation analyses that will stand up to regulatory and auditor scrutiny.
409A/Stock Compensation
When granting or measuring the impact of equity awards and complex securities, our clients use our services to assist in planning and design of equity awards as well as tax and financial reporting compliance. Our analytical and modeling depth and proprietary valuation models are tailored to our clients’ needs, using appropriate underlying modeling techniques like Black-Scholes Option Pricing, Binomial Lattice, and Monte Carlo Simulation.
Gift & Estate
OBV Advisory provide valuations of interests in closely held businesses or other securities as well as discount studies for partnerships or other estate planning vehicles.
Employee Stock Ownership Plans
Determining a stock’s fair market value is critical in establishing and maintaining an Employee Stock Option Plan (ESOP) and is necessary to satisfy relevant IRS and Department of Labor (ERISA) requirements. A preliminary valuation provides management and shareholders with an approximate indication of company value and compares the ESOP with alternatives available to shareholders. ERISA regulations permit an ESOP security transaction only if such transactions are performed at a fair market value. IRC Section 401(a)(28)(c) mandates annual valuation of an ESOP by an independent business appraiser. ESOPs also contain a “put option” enabling plan participants, retired participants and beneficiaries to sell distributed ESOP shares back to the trustee at a fair market value. The price at which this transaction occurs is updated annually. An annual update becomes less time consuming and less costly than the initial valuation since our staff is familiar with the company and its financial data.
Pursuing strategic growth through a business combination, leveraged buyout, divestiture or any other means also require a qualified, third-party valuation firm that can help your board of directors support their deal-making decisions, mitigate risk, withstand scrutiny and improve shareholder transparency.
Fairness Opinions
We help boards of directors, special committees, companies, and business owners fulfill their fiduciary duties—by providing them with comprehensive analyses and unbiased opinions about a financial fairness of pending transactions. Our intellectual rigor and wide-ranging financial expertise position us as a trusted advisor for clients worldwide.
Solvency Opinions
We render solvency opinions on behalf of boards of directors, lenders, equity sponsors, and investment banks. Our opinions provide an additional level of protection, mitigating our clients’ risk of fraudulent conveyance.
The importance of experience cannot be undervalued when determining the fair value of illiquid securities. It is important to partner with third-party valuation specialists. OBV assists our clients with more traditional illiquid securities valuations and highly complex illiquid securities.
Complex Securities
Management is responsible for appropriately valuing complex securities for audit, general reporting and tax purposes. OBV helps our clients determine fair value estimates and lower the risks of late filings, restatements, delays and additional costs. We bring deep experience valuing a wide range of complex securities, including credit/debt instruments, derivatives, equity and structured products.
Engagements often arise from needs relating to: early- or development-stage companies, share-based payments including equity compensation awards (ASC 718), derivatives and hedging instruments (ASC 815), nonqualified deferred compensation plans (IRC Section 409A) and related tax scenarios, other hard-to-value financial instruments and arrangements such as earnouts.
Derivatives are widely used to provide hedging or flexibility in investing. Under Accounting Standards Codification 815 (ASC 815), financial reporting must recognize derivatives and hedging activities as either assets or liabilities and express their fair values.
In private contexts, OBV values complex securities with economic rights relating to preferred stock, warrants and LLC profit interests. We apply option pricing, taking into account specific capital structure and distribution rights. For public companies, we apply complex modeling to stock options, restricted stock and other share-based compensation.
Portfolio Valuations
Due to increased investor, audit and regulatory scrutiny around fair value reporting for illiquid, non-public investments, private equity funds, private debt funds, hedge funds, financial institutions and investors rely on OBV for independent third-party valuation services.
When an investment portfolio includes illiquid, non-public assets, a specialist is often needed to analyze and report the valuation of these investments for financial, investor or lender reporting.
Engaging a third party to perform portfolio level valuations, the valuation process bolsters documentation, increases independence and transparency and materially reduces measurement and reporting risks.
The importance of experience cannot be undervalued when determining a fair value of illiquid securities. It is important to partner with a third-party valuation specialists. OBV Advisory assist our clients with more traditional illiquid securities valuations and highly complex illiquid securities.
Complex Securities
Management is responsible for appropriately valuing complex securities for audit, general reporting and tax purposes. OBV Advisory help our clients determine fair value estimates and lower risks of late filings, restatements, delays and additional costs. We have a solid experience in valuing a wide range of complex securities, including credit/debt instruments, derivatives, equity and structured products.
Engagements often arise from needs relating to: early- or development-stage companies, share-based payments including equity compensation awards (ASC 718), derivatives and hedging instruments (ASC 815), nonqualified deferred compensation plans (IRC Section 409A) and related tax scenarios, other hard-to-value financial instruments and arrangements such as earnouts.
Derivatives are widely used to provide hedging or flexibility in investing. Under Accounting Standards Codification 815 (ASC 815), financial reporting must recognize derivatives and hedging activities as either assets or liabilities and express their fair values.
In private contexts, OBV Advisory value complex securities with economic rights relating to preferred stock, warrants and LLC profit interests. We apply option pricing, taking into account specific capital structure and distribution rights. For public companies, we apply complex modeling to stock options, restricted stock and other share-based compensation.
Portfolio Valuations
Private equity funds, private debt funds, hedge funds, financial institutions and investors rely on OBV Advisory for independent third-party valuation services, due to increased investor, audit and regulatory scrutiny around a fair value reporting for illiquid, non-public investments.
When an investment portfolio includes illiquid non-public assets, a specialist is often needed to analyze and report the valuation of these investments for financial, investor or lender reporting.
Engaging a third party to perform portfolio level valuations, valuation process bolsters documentation, increases independence and transparency, and materially reduces measurement and reporting risks.