1
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CPD Hours Level
Seminar 3 IntermediateInformation
Accreditation Information

Introduction

The hurdles to overcome and the difficulties in reaching agreement on the completion mechanism and sale and purchase agreements (SPAs) can often frustrate and sometimes derail transactions.

This course aims to provide lawyers with an understanding of the key accounting and financial issues in business and share purchase documentation to assist you in advising buyers and sellers.

You will gain a deeper understanding of the various aspects and how to achieve a successful outcome for all parties involved. The speakers will also provide their experience of what they are seeing in the market at the moment.

What You Will Learn

This course will cover the following:

Enterprise Value v Equity Price

  • Bridging between headline price and price paid/received on deals
  • What does ‘cash free, debt free, and a normal level of working capital’ really mean?
  • Interpreting ‘cash’, ‘debt’ and ‘working capital’ from a buyer v seller’s perspective
  • How accountants establish ‘normal working capital’
  • Factors to consider for off-market deals v multi-party processes (for sellers and buyers)

Completion Accounts

  • The accounting hierarchy:
    • Specific accounting policies - how to draft meaningful specific accounting policies
    • Consistency - with what?
    • Defining GAAP and the risk of relying only on GAAP
  • Tips regarding the mechanisms and strategies for the preparation and agreement of completion accounts
    • Dispute resolution considerations
    • Timing considerations
    • Practicalities of who prepares and who reviews

‘Locked Box’ Deals

  • How locked box deals differ from conventional price adjustment deals
  • The nature of locked box accounts compared with annual accounts or completion accounts
  • ‘Leakage’ and ‘permitted leakage’
  • The value accrual ‘ticker’

Accounting Warranties

  • Purpose and content
  • Differences between management accounts warranties and statutory accounts warranties
  • Post accounts date events: material adverse change warranties
  • Locked box considerations

Earn-Outs

  • Picking a measurement basis
  • Pitfalls of relying on ‘EBITDA’ or ‘profit’
  • Treatment of non-recurring items
  • Post-completion acquisitions
  • Continued involvement of sellers
  • Synergies: ensure comparing ‘apples with apples’ in mechanics of earn-out

Disputes

  • Most common areas of dispute
  • Strategies to avoid disputes pre-deal
  • Dispute resolution post-deal

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Seminar | 24.02.2020

Glasgow | 2:00pm - 5:15pm


Acquisition Agreements - Accounting Essentials for Corporate Lawyers

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Feb
24
2020
Glasgow
2:00pm - 5:15pm
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Prices (ex VAT)
Smart
Plan Information
£108
Season
Ticket Information
£120
Standard
£240
Group bookings
Discounts are available for multiple places and if you have 5 or more people interested in this course and would like to discuss holding it in your area or on an in-house basis then please email us at information@mblseminars.com
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