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How an Accountant Helps in Company Mergers and Acquisitions

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Accounting services are essential for more general operations in company and corporate settings, but become essential when large corporations are acquiring other businesses and absorbing their assets. Expertise is required as companies consider acquisitions and mergers with other businesses, and that kind of number crunching is handled best by professional accounting services.

Assets and Liabilities Assessment

Accountants must work together with a third-party evaluation firm to accurately determine what the assets are that will be gained through the merger. Accountants record these assets based off listed market values according to the date of the acquisition, and then make their calculations accordingly. The goal is to accurately sum up this data to help with translating it to the most accurate translation of themes.

Consideration Paid Evaluation

A paid evaluation is necessary in trying to best understand the market value, and an accurate assessment of assets. These assets can come in the form of cash, stock or any other attribute of value to a business, and once again they’re considered according to their market value on the date of acquisition. Accountants provide these assessments, once again, in conjunction with a third-party business to provide accurate and fair assessments.

Eliminating Unrecorded Accounts

Sometimes, after a merger, there will be accounts associated with a business that will become irrelevant after the merger is complete. Accountants must evaluate these and create a journal that clearly tracks the removal of these accounts. Credits, stocks and debits may all be relevant in this evaluation, and the result is a clearer assessment of what the value of the acquisition is.

Consolidating Financial Statements

A merger acquisition requires a consolidation of financial statements between the two groups involved. An accountant is needed to review and consolidate balance sheets and income statements, and make sure that the listed entries accurately reflect the liabilities, revenues, expenses and assets of the acquisition that’s being joined.

A professional accountant or accounting team with expertise in assisting mergers and acquisitions is essential in these scenarios for ensuring accurate accounts, numbers that adhere to legal standards, and the successful financial osmosis of the acquired company’s assets and so forth. The security that specialist accountants provide, from a financial and legal standpoint, makes them invaluable. Senior leaders and other financial analysts will help make clear the value, cost and final returns that you can expect on the other side of the merger, making professional accounting in Los Angeles invaluable.

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