Financial Reporting – Allocation of Purchase Price/Impairment

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Healthcare and seniors housing owners and operators that make an acquisition are required to allocate the purchase price among various asset classes in order to comply with Generally Accepted Accounting Principles (GAAP) including FASB ASC 805 (Business Combinations), FASB ASC 820 (Fair Value Measurements), FASB ASC 350 (Intangibles – Goodwill and Other), and FASB ASC 360 – (Impairment or Disposal of Long-Lived Assets).  These reports are also essential in setting up financial records.

Principle Valuation provides the comprehensive and accurate allocation of the purchase price for the following asset classes:

  • Real estate (land, buildings and improvements)
  • Leasehold interests and improvements
  • Furniture, fixtures and equipment
  • Intangible assets, including tradenames, assembled workforce, medical records, Certificate of Need (CON), provider contracts, net operating loss carryforwards, customer relationships, non-compete agreements and minority equity interests owned

Based on our national scope and expertise, we have had our work reviewed and accepted by most major accounting firms.

Healthcare and seniors housing entities turn to us for allocation of purchase price studies because:

  • They trust that our reports will be accurate and fair, and will be performed in a timely manner
  • Our reports are performed by professionals with specific expertise in the healthcare and seniors housing sectors who hold designations such as ASA, CFA, CPA and MAI
  • Our professional staff have specific expertise in all healthcare and seniors housing asset classes, including real estate (land and improvements), equipment, and intangible assets

Projects

  • Valuation for financial reporting, including the allocation of the purchase price to the real estate, equipment, CON’s, trademarks, Medicare licenses and other intangible assets for a publicly traded healthcare company with 62 hospitals in 29 states
  • Valuation of a regional hospital and its related entities for financial reporting based on an Affiliation Agreement with a larger hospital system

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Our clients have used Principle Valuation for valuations for purchase and sale transactions, compensation relationships, and support for tax purposes. They do straightforward and intelligent work, and are very responsive.

Scott Becker, Partner, McGuire Woods

We selected Principle because of their experience and reputation in the market. They are very knowledgeable about the industry, and particularly HUD financing. They were very thorough and hit their deadlines. Their appraisal went through HUD with no issues, which also made the borrower very happy.

Ken Buchanan, Senior Vice President and Chief Underwriter (Eastern Region), Walker Dunlop

Principle Valuation provides excellent valuations for ongoing healthcare enterprises, as well as placing values on the individual assets. They are very timely, reliable, have a solid understanding of the regulatory implications of their work, and are authoritative in the way they present their information.

Mike Anthony, Partner, McDermott, Will & Emery

Principle Valuation is far superior to any other valuation firm we have worked with. They are knowledgeable about businesses, real estate and equipment. And their reports are always right the first time.

Ken Doran, President and CEO, Spectrum Heatlh Partners

Contact

190 South La Salle Street, Suite 2900
Chicago, IL 60603
312.422.1010
info@principlevaluation.com