Guidance from AICPA’s 2024 Accounting and Valuation Guide—Business Combinations There are various methods used to value intangible assets. The relief from royalty method is based on the premise that there are royalty savings if the acquiror acquires the asset instead of licensing it. The value of the asset is calculated as the present value of after-tax royalty savings over the economic life of the asset. This article delves into the available methods used to value brands. When a company acquires another company, the acquiror may need to perform a purchase price allocation. In essence, the purchase price allocation (PPA) analysis…
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Non-compete agreements are increasingly in the news, though not always in the most favorable of contexts. Proponents argue that such agreements protect firms’ intellectual property and prevent the loss of key employees, customers, suppliers, and trade secrets. Karolina Calhoun, senior financial analyst with Mercer Capital, explains that others would suggest that non-competes stifle innovation by limiting competition and employee mobility. To read the full article in Mercer Capital’s Financial Reporting Blog, click: Non-Compete Agreements: The Good, the Bad, and the Ugly. This article is republished from Mercer Capital’s Financial Reporting Blog. It is reprinted with permission. To subscribe to the…
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Document Incentive, Retention, and Non-Compete Agreements; Build a Broad Management Team Business owners need to be careful about vague assurances to “take care of” key employees before an acquisition. Brett Stacey offers tips on how best to manage a transition in a responsible manner that’s likely to address hurt feelings, protect employee morale, and minimize law suits.
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The FASB Lists 29 Different Intangible Asset Categories. Here’s What You Need to Know. Intangible assets have comprised an increasing proportion of the value of assets of most companies in the last decade, Gregory Marsh explains. Often a collection of intangible assets is accounted for as a single asset labeled “goodwill.” Here’s why that sometimes doesn’t make sense.