Access our library of publications providing insights and commentary on key valuation issues and topics.
How to recognize – and remedy – the finance organization’s capital allocation deficiencies
Potential deficiencies can impede a company’s ability to fund a spending portfolio that is in line with strategic direction and increases shareholder value.
Secrets of the activist manager
Activist investors have their megaphones. But insiders have a more powerful tool for creating value: deep knowledge of their business and customers.
Thoughts on calculating discounts for lack of marketability (DLOMs)
A contingent claims analysis (CCA) is one recommended way of valuing non-marketable securities in a complex capital structure. In this article, we describe a method for calculating DLOMs that differ based on a security’s unique volatility.
Risk-minimizing and insurance hedging
The complex valuation and financial reporting challenges in each of these four hedging cases is analyzed and illustrated with examples:
Market’s reaction to accelerated share repurchase announcements
Accelerated share repurchase (ASR) programs can help improve capital structure or tax treatment by shifting the timing of cash payments to shareholders. A better understanding of the market’s reaction to ASR announcements can help guide decisions regarding the use of this strategy.
Cross-sector valuation: What companies should consider when acquiring tech targets
As companies in competitive industries continue transforming themselves through technology-focused acquisitions, unique valuation issues can challenge deal success. Analyzing the sources of competitive advantage can play a key role in informing M&A decisions and can help increase shareholder returns. Using the most appropriate valuation method and avoiding common pitfalls and valuation errors can be the difference between a successful or failed transaction.
Valuing Warrants: Dilution and Down-Round Price Protection
This paper, originally published in Business Valuation Review, provides technical guidance on two warrant valuation topics: dilution and down-round price protection. It includes detailed examples and analysis illustrating the mechanics of complex approaches to valuing warrants.
The valuation impact caused by changing times: Why economic obsolescence matters for retail companies
Economic obsolescence can become a significant issue when a company has or is acquiring assets – such as store or restaurant locations – that generate separate identifiable streams of cash flows. This publication discusses factors that typically cause economic obsolescence and the potential impact, including illustrative examples and case studies.
The valuation profession - At a crossroads
Currently, there is no single professional framework governing the valuation profession in terms of conduct, education, credentialing, and performance. This PwC point of view discusses how creating a professional framework would reduce expectation gaps between the profession and management, auditors, standard setters, and regulators. Having a professional valuation framework will also help inspire confidence in the quality and consistency of the work performed.
Global valuation standards - Charting a course for the future
This PwC point of view discusses how the valuation profession could benefit from establishing a primary technical voice to issue high-quality standards for financial reporting that can enhance quality, promote consistency in practice, and advance the brand of the profession as a whole.
Brands: What’s in a name?
This publication provides important guidance for consumer products companies to consider when planning a brand-rich transaction. It explains how keeping a careful eye on the valuation and purchase accounting issues can provide better insight into the potential accretive or dilutive impact of a deal, help improve and streamline post-deal accounting and even reduce the risk of impairment in some cases.
Entertainment & Media asset valuation in the Digital Age
PwC believes that the traditional methods employed to value intangible E&M assets -- while still valid -- may ultimately need to evolve in the interest of improved reporting. This new publication discusses some timely valuation issues for E&M companies.
Improving capital deployment: Looking beyond balanced scorecards and benefit-to-cost analysis
A range of approaches can be used by organizations to rank projects and decide how to deploy capital most efficiently. Balanced scorecards and benefit-to-cost analysis offer a potential "first-cut window" into efficient capital deployment. But they fall short in helping to optimize a portfolio of projects. This discussion paper explores how Project Portfolio Optimization (PPO) helps overcome the limitations of alternative approaches by considering key variables such as multiple resource constraints and project dependencies.
Understanding book versus tax valuation differences improves M&A planning and reporting
Finance, accounting, and tax professionals constantly ask whether it is appropriate to use financial reporting valuation estimates for tax purposes and whether there are parts of valuations for financial reporting or tax that are interdependent. M&A transactions trigger different rules and procedures with respect to allocations of purchase price under US GAAP and US federal tax principles. Differences between the purchase price allocation rules for financial reporting purposes and tax continue to exist and best practice calls for an integrated analysis where both book and tax valuations are performed simultaneously.
Avoiding earnings surprises: Address valuation and purchase accounting impacts up front
As your company pursues acquisitions, are you confident with estimates of how the deal will impact earnings? Without the right approach, you risk misinforming investors about the deal and having to recast financial statements. Learn how you can avoid earnings surprises by completing a pre-acquisition valuation during the due diligence process.
Sustainability valuation: An oxymoron?
Determining valuation of a company's sustainability initiatives presents challenges. Considering both direct and indirect valuation methods helps analyze, prioritize and measure the contribution sustainability initiatives make to shareholder value.
Reducing goodwill impairment testing costs
Goodwill impairment testing may get simpler when companies adopt guidelines recently issued by the Financial Accounting Standards Board (FASB). Using a qualitative approach outlined by the new standard may reduce preparer costs by streamlining the annual goodwill impairment testing process.
Valuing contingent consideration using option pricing
Including an "earn-out" or contingent consideration in an acquisition lets buyers tie payment to future performance. However, fair value accounting for contingent consideration involves significant challenges. PwC provides a comprehensive and technically detailed discussion of Valuing contingent consideration using option pricing in this informative publication.
Using qualitative impairment testing for FCC licenses
Accounting Standards Update 2012-02 presents an opportunity for broadcasters to streamline their annual goodwill impairment testing on FCC licenses that are maintained as indefinite-lived assets. This PwC whitepaper discusses key variables to consider when determining if a qualitative analysis -- sometimes referred to as “Step 0” -- may be feasible for FCC licenses.
Uncovering blind spots in deal valuations
Successful deal making requires a focus on the relationship between risk and return. However, some potential "blind spots" can threaten your probability of realizing expected value from an acquisition.