M&A Accounting

Post-Deal Accounting Demands Specialized Expertise

When a bank merger or acquisition is consummated, the accounting challenges are just beginning. Once the deal is done, the acquiring bank’s senior management team and accounting personnel will encounter many complexities in accounting for the acquired institution’s assets and liabilities.

As part of its comprehensive array of bank merger and acquisition (M&A) services, Crowe Horwath LLP helps institutions address post-acquisition accounting issues. Our accounting professionals work with management teams to assess how purchase price allocation and industry-specific issues will affect reported earnings. Working closely with the Crowe valuation team, our accounting professionals also can help a bank comply with current Financial Accounting Standards Board Accounting Standards Codification (ASC) topics, including:

  • ASC 820, which defines fair value and provides a measurement framework
  • ASC 350, which governs impairment testing of goodwill and other intangibles
  • ASC 805, which addresses purchase price allocation studies
  • ASC 360, which governs impairment or disposal of long-lived assets
  • ASC 825, which spells out fair value opinions for financial assets and liabilities
  • ASC 310-20 and ASC 310-30, which cover accounting for acquired loans and purchased credit-impaired loans

These standards have a significant impact on a bank’s financial statements and on core strategic and operational matters such as allowance for loan loss planning and related capital planning concerns. Drawing on their banking-specific accounting expertise, Crowe professionals provide management the tools it needs to accurately assess and understand these effects – from day one onward.

Crowe bank M&A professionals work closely with your institution’s internal resources to help implement the necessary accounting procedures and to develop appropriate post-transaction accounting policy and financial reporting structures that can help maintain compliance and guide future decision-making.

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Rick L. Childs