Purchase Price Disputes

When there are allegations of pre- or post-acquisition fraud, financial statement misrepresentation, fraudulent inducement or breach of contract, objective and evidence-based analyses of forensic accounting and valuation can be crucial to an efficient and fair resolution. We help entrepreneurs, private equity investors and their attorneys navigate the intricate maze of accounting and financial issues that can give rise to purchase price disputes, including disagreements over financial representations, working capital adjustments, earn-out calculations and much more.

Integrated Transaction Advisory Support

At Weaver, our forensic accounting and dispute resolution capabilities are strengthened by our deep bench of transaction advisory professionals. Our transaction advisory services (TAS) team provides critical insights during the deal lifecycle — from quality of earnings (QofE) analyses and working capital assessments to tax structuring and IT due diligence. These services not only help prevent disputes but also provide essential context when disagreements arise post-acquisition.

Our Team Speaks the Language of Post-Acquisition Disputes

Most of our professionals have advanced degrees and certifications in areas such as accounting (CPA), valuation (ASA, ABV, CVA), financial forensics (CFF, MAFF) and fraud investigation (CFE). As professionals who routinely serve as expert witnesses and consulting experts to either one or both parties in a purchase price dispute, our team members have performed a wide variety of services to help the parties resolve their differences, both in and out of the courtroom.

Misrepresentation and Fraud

Our forensic accountants investigate and evaluate financial and accounting records to identify misrepresentation or fraud in pre- or post-closing financial information. Weaver professionals help uncover pre-acquisition overstatements of revenues or concealment of expenses or liabilities inflating the purchase price, or post-acquisition manipulation of financial metrics driving earnout calculations.

Financial Performance Disputes

Disputes can arise when post-acquisition financial performance of the company does not meet the expectations of the buyer based on representations by the seller during the due diligence process and purchase price negotiation. Our team of forensic accountants can analyze the company’s financial and accounting information to determine the root cause or drivers for any performance issues, including changes in market conditions, operational issues or mismanagement, among others. Insights from pre-acquisition due diligence — such as financial, operational and IT assessments — can be instrumental in identifying whether post-close performance issues stem from pre-existing conditions or post-acquisition missteps.

Purchase Price True-Ups and Adjustments

From working capital true-ups to earnout calculations, there can be many post-acquisition adjustments to the purchase price agreed upon by the parties. In many cases, application of accounting principles and policies, timing of the transaction, seasonality of the business, operational changes and myriad other factors can cause differences in the way purchase price true-ups and adjustments are calculated. Our TAS professionals, who frequently support these calculations during the deal process are a valuable resource to our forensic team when these issues arise in a dispute. Our team’s deep knowledge in GAAP financial statement reporting, combined with our forensic accounting acumen, helps parties identify the root cause of any differences and reach a fair outcome.

Expert Witness Testimony

Our team of forensic accountants as well as valuation and tax professionals have testified numerous times in state and federal courts, as well as in arbitrations and are skilled at presenting evidence and testimony that is objective and easy to understand by judges, arbitrators and juries. Our experience translates into added capabilities for legal counsel for either party in a dispute, often shortening the time to resolution.