M&A encompass agreements and transactions between two parties. It is essential to understand the financial reporting issues faced in a relevant merger or acquisition scenario. Financial reporting is the disclosure of financial results and related information to management and external stakeholders (e.g., investors, customers, regulators) with regard to the company’s performance in a specified period of time. Financial statements may vary significantly post-merger or in restructuring. New categories of assets and liabilities may be recognized on the combined balance sheet while existing assets and liabilities may be measured according to different conventions. Further, balance sheet items that were recognized prior to the acquisition may be derecognized in the post-acquisition accounts. In our Financial Reporting Advisory Services (‘FRAS’) we make maximum use of financial reporting experts to support effective decision making by different stakeholders by providing them with potential impacts or changes in financial reporting arising due to M&A or restructuring deals.

We provide the following services in this domain:

• Financial due diligence to identify impact areas between financial reporting of two or more entities subject to M&A/restructuring activity.
• Evaluation of share purchase agreements to flag important decision making considerations by different stakeholders.
• Comparative analysis for financial impacts under different scenarios or options being evaluated by stakeholders.
• Assess the financial reporting impacts of different ESOP schemes as envisaged under M&A deals.
• Assistance in preparation of merged or carved out financial statements on the date of merger or demerger.
• Assistance in financial reporting subsequent to the execution of transactions.