#mergers-and-acquisitions
Mergers and Acquisitions
Accounting guidance for business acquisitions, goodwill, purchase price allocation, and deal structuring
Letter of Intent for a Small Business Sale: What's Binding, What's Negotiable, and What Kills Deals
Most letters of intent are labeled non-binding, but exclusivity, confidentiality, and break-up-fee clauses inside them are typically enforceable. This guide covers LOI terms in sub-$10M business sales — asset vs. stock structure, 30–90 day exclusivity windows, working capital true-ups, price allocation, and the mistakes that cost sellers deals.
You Bought a Micro-SaaS, Not Software: Purchase Price Allocation and the 15-Year Section 197 Rule
Software acquired as part of buying a business amortizes over 15 years under IRC Section 197 — not the 36 months standalone software gets. How to allocate a micro-SaaS purchase price across the seven IRS asset classes, agree on Form 8594 with your seller, and record it in a plain-text ledger.
Nonprofit Merger Accounting: What ASC 958-805 Requires Before You Sign
Under ASC 958-805, a combination of two nonprofits must be classified as either a merger, which uses the carryover method with no fair-value remeasurement or goodwill, or an acquisition, which requires fair-value remeasurement and an immediate expense instead of capitalized goodwill for any excess consideration.
Broadcom FY2025 Earnings: $63.9B in Revenue, and a Net Income That Nearly Quadrupled to $23.1B
Broadcom's FY2025: $63.9B revenue (+23.9%) and GAAP net income of $23.1B, up 292% from $5.9B — but decomposing the $17.2B swing shows revenue growth explains only 72% of it, with roughly $4.8B coming from a tax provision flipping to a $397M benefit plus one-time restructuring and discontinued-operations reversals. The durable signals are Infrastructure Software's operating margin rebounding to 76.8%, above its pre-VMware baseline, and AI semiconductor revenue guided to roughly double to $8.2B. Rebuilt line by line in a public Beancount ledger, FY2021–FY2025.
Corporate Cards and Spend Management in 2026: Choosing Between Ramp, Brex, and the Rest After the Capital One Deal
Capital One's $5.15 billion acquisition of Brex, which closed in April 2026, adds integration and roadmap uncertainty to a corporate card market that also includes Ramp, BILL Spend & Expense, and Aspire, so small businesses now need to weigh vendor stability alongside features and pricing.
Section 1059 Extraordinary Dividend Basis Reduction: The Corporate Shareholder Trap That Turns Tax-Free Dividends Into Immediate Capital Gain
Section 1059 reduces a corporate shareholder's stock basis by the nontaxed portion of an extraordinary dividend — 5% threshold for preferred, 10% for common — when received within two years of acquisition, with excess immediately taxed as capital gain. This guide covers the thresholds, the 85-day and 365-day aggregation rules, the FMV election, the non-pro-rata redemption exceptions, and the lot-level bookkeeping that keeps corporate finance teams out of audit trouble.
F-Reorganization Under Section 368(a)(1)(F): The Pre-Closing Restructuring PE Buyers Use to Buy S Corporations
A practical walkthrough of the Section 368(a)(1)(F) reorganization — the six regulatory requirements, the six-step Rev. Rul. 2008-18 choreography, why PE buyers prefer it to a 338(h)(10) election, and how it preserves the operating EIN while giving the buyer asset-basis step-up and the seller tax-deferred rollover equity.
The Net Working Capital Peg and Post-Closing True-Up: How Business Sellers Lose Six Figures at Closing
How the net working capital peg and post-closing true-up quietly transfer cash from sellers to buyers in mid-market M&A, and the monthly accrual-basis bookkeeping discipline that protects sale price.
Quality of Earnings Reports: How Sellers Defend EBITDA, Survive Buyer Due Diligence, and Avoid Last-Minute Price Cuts
A Quality of Earnings (QoE) report decides whether a buyer accepts your EBITDA or re-trades the deal price. This guide breaks down the 12 add-backs buyers accept, the 8 they reject, and how the working capital peg quietly cuts seller proceeds at closing.
Section 7874 Anti-Inversion Rules: 60%/80% Ownership Tests and the Substantial Business Activities Safe Harbor
Section 7874 imposes a 10-year inversion-gain floor when former U.S. shareholders own 60-80% of a new foreign parent and reclassifies the parent as a domestic corporation at 80%. The only escape is the substantial business activities safe harbor, which requires clearing a 25% bright-line threshold on employees, tangible assets, and gross income in the foreign country.
ASC 805 Purchase Price Allocation: Acquired Intangibles, Earn-Outs, Pushdown Accounting, and Form 8594 Reconciliation
How acquirers execute a purchase price allocation under ASC 805 — identifying intangibles, handling bargain purchases and earn-out volatility, electing pushdown accounting, and reconciling the GAAP allocation to Form 8594 under Section 1060.
ASC 820 Fair Value Measurements for Private Companies: Level 1, 2, and 3 Hierarchy, Unobservable Inputs, and Earn-Outs
A practical guide to ASC 820 fair value measurements for private companies, funds, and CFOs—how to classify Level 1, 2, and 3 inputs, build defensible Level 3 valuations for private equity stakes and earn-outs, write disclosures auditors accept, and survive scrutiny of unobservable assumptions.