Mergers & Acquisitions

A US based public telecommunications company with limited resources and outdated accounting systems closed an acquisition of a multinational company headquartered in the UK. The Form 8-K/A, including historical audited and pro forma financial statements, was due within 75 days of the closing date.

Challenge:

  • The target company had never been consolidated or audited; historical books and records were maintained in multiple countries’ accounting principles; the SEC filing required three years of audited US GAAP financial statements
  • The target maintained five distinct legal entities and corresponding ledgers, each maintained in a disparate accounting system
  • High volume of intercompany transactions with little oversight or reconciliation process
  • Company did not have a functioning consolidation model
  • Numerous complex transactions required evaluation under US GAAP.

Solution:

  • WilliamsMarston’s team traveled to the UK and worked alongside client management and their external auditors
  • Built four unique revenue and cost of sales excel-based sub-ledgers to facilitate the audit and serve as an intermediate bridge until a new accounting system could be implemented
  • Completed ten technical accounting memos that were reviewed by the audit firm’s national office, including those for functional currency, consolidation, stock-based compensation, revenue recognition and purchase accounting

  • Converted historical records to US GAAP and built an excel-based consolidation model to properly reflect the impact of foreign currency and intercompany transactions

Result:

Clean audit opinion issued on the target’s historical financial statements, target’s audited US GAAP financial statements and acquirer’s pro forma financial statements were filed timely in Form 8-K/A.

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Mergers & Acquisitions

A $250 million public company closed an acquisition of a multinational target requiring the preparation, conversion and audit of five legal entities’ financial statements.

2017-02-22T09:24:37+00:00