Drawing upon experience from a diverse set of disciplines and backgrounds, Withum’s accounting, valuation, and financial professionals combine the highest standards of technical skill and knowledge to tackle complex litigation involving business disputes and economic damage assessments. From litigation support to dispute resolution, to M&A post-closing disputes and testifying services, Withum’s financial advisory team support businesses and legal counsel through every phase of litigation throughout the world.
Attorneys contact Withum’s Forensic and Valuation Service financial experts to assist both plaintiffs and defendants with quantifying and calculating economic damages and providing assessments that are reliable and defensible. In addition to Certified Public Accountants (CPA), Withum’s diverse team of forensic accountants and damage experts have years of investigative experience and are also Certified Fraud Examiners (CFE), Certified Anti-Money Laundering Specialists (CAMS), Certified in Financial Forensics (CFF), Accredited in Business Valuation (ABV), Certified Valuation Analysts (CVA), and Master Analysts in Financial Forensics (MAFF).
Withum’s experts can assist in a variety of business disputes, including, but not limited to the following types of litigation:
- Breach of fiduciary responsibility
- Subrogation claims
- Wrongful employment termination
- Personal injury
- Post- Acquisition/Earn-out disputes
- Construction claims litigation
- M&A post-closing disputes
For more information or to discuss your business needs, contact Withum’s Forensic and Valuation Services Team.
M&A Post-Closing Disputes
Deals happen every day whereby a seller or buyer is confronted with unanticipated post-closing circumstances, as the perceived value and basis for the transaction fails to materialize. There are any number of reasons both expected and unexpected as well as those that are beyond the control of either the buyer or seller.
Withum’s team of experts, including transaction advisory and forensic and valuation professionals, represent buyers and sellers in the negotiation of their deal and when situations arise that question the consideration of value exchanged.
Primacy Sources of Disputes Include:
Post-closing the actual working capital on the date of closing will be assessed and compared to the estimate at closing. Issues impacting the working capital calculation include:
■ Collections of accounts receivable do not materialize
■ Inventory is obsolete
■ Revenue recognition is incorrect
■ Contingent issue(s) do not pan out as expected
Earnouts are the place where expectations meet reality. The seller has expectations, and the buyer is confronting reality. Key questions that must be addressed are:
■ Were the targets attainable in the first instance?
■ How were the results measured?
■ Did the buyer change something post-closing that impacted the measurement or realization?
Counsel will seek to address the unknowns through representations and warrantees of the parties. Circumstances documented in the contracts or observed in due diligence may not always materialize. It must be evaluated if this was:
■ A misrepresentation from the start
■ Deliberate (either through knowing omissions or falsifications)
■ An event beyond the control of either party
Withum’s accounting and advisory specialists have the people, tools and expertise to work with you and your counsel to investigate and evaluate the post-acquisition issues in dispute.
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