The Financial Reporting Blog

A weekly update on financial reporting topics curated by Mercer Capital’s Financial Reporting Valuation professionals


Noncompete Agreements for Section 280G Compliance

Golden parachute payments have long been a controversial topic. These payments, typically occurring when a public company undergoes a change-in-control, can result in huge windfalls for senior executives and in some cases draw the ire of political activists and shareholder advisory groups. Golden parachute payments can also lead to significant tax consequences for both the company and the individual. Strategies to mitigate these tax risks include careful design of compensation agreements and consideration of noncompete agreements to reduce the likelihood of additional excise taxes.

Fair Value (and More) in the Animal Health Industry

How is a veterinary practice or animal hospital valued? Knowing which methods to apply in the valuation of a veterinary practice and which assets to recognize in a business combination can have a material impact on the value of a company and its purchase price allocation.

Twilio and the Rise Of Debt Financing

Twilio, a cloud communications platform designed to help developers add messaging, voice, and video to web and mobile applications, went public on June 23. Priced at $15 per share, Twilio’s share price closed at $28.79, the largest single-day increase of an IPO in over two years, which increased the company’s market cap by 95% to nearly $2.4 billion.

Windfall or Shortfall? Equity Compensation for Outside Service Providers

In a typical service provider-customer relationship, the provider delivers a service and the customer delivers cash. Upon delivery, both parties are happy and move along to the next transaction. However, a trend that gained popularity in the early 2000s adds an extra level of complexity to this seemingly simple business relationship – equity payments.

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