HG, LLP

The financial industry is one of the most heavily regulated sectors in the global economy. It operates within a complex web of laws, regulations, and standards, with institutions and professionals seeking assistance to successfully comply with ever-evolving mandates.

In this complex arena, where precision and expertise are paramount, HG, LLP stands as a beacon of excellence.

The renowned financial advisory firm goes beyond the conventional scope of services by offering a wide range of valuation and financial due diligence solutions. Serving both public and private companies, HG, LLP has earned a stellar reputation for consistently delivering unparalleled value to its clients.

“Our differentiating factor lies in the comprehensive range of services we offer. When clients approach us for assistance, it goes beyond mere valuation; we provide a full spectrum of services, including financial due diligence and SEC reporting" says Brandy Gao, managing partner of HG, LLP.

At the heart of HG, LLP's portfolio is its extensive industry expertise. The firm specializes in four key types of valuations:

1. It excels at providing 409A valuation services, catering to the companies issuing stock-based compensations. These valuations are essential for companies looking to ascertain the true value of their entities, providing a solid foundation for equity-based compensation plans.

2. HG, LLP's proficiency extends to assisting clients in business valuations for mergers and acquisitions (M&A). Whether initiating M&A transaction or undergoing changes in ownership, companies can rely on HG, LLP for precise and insightful evaluations, which are crucial to negotiating and executing successful transactions. Post M&A transactions, HG, LLP provides purchase price allocation services to support companies in accurately allocating purchase consideration amounts and determining the goodwill value. Under Accounting Standards Codification (ASC) 805, business combinations must be accounted for using the acquisition method, which mandates all identifiable assets acquired, including goodwill, liabilities assumed, and any non-controlling interests, should be stated on the balance sheet at fair value. HG helps clients stay in compliance with ASC 805.

3. HG, LLP also specializes in valuation for complex securities, demonstrating a proven track record in navigating the intricate world of convertible notes, warrants, and other emerging financial instruments. With its expertise in determining fair values, HG, LLP empowers companies to maintain compliance with ASC 820, ensuring accurate presentation of fair values for complex securities in financial statements. This proficiency not only facilitates adherence to accounting standards but also guides well-informed and strategic financial decisions when selecting the right financing instruments. HG, LLP is dedicated to ensuring clients not only comply with accounting standards but also optimize their financial reporting, fostering a solid capital infrastructure.

4. In the realm of Special Purpose Acquisition Companies (SPACs) and other public companies, HG issues fairness opinion report that evaluates the facts of a merger, acquisition, carve-out, spin-off, buyback, or types of business purchases. HG, LLP provides an opinion about whether or not the proposed purchase price is fair to the selling or target company.

In addition to valuations, HG, LLP offers services in preparing financial reports for filing with the U. S. Securities and Exchange Commission (SEC), ensuring fairness and transparency in quarterly filings. Moreover, HG, LLP can serve as the outsourced CFO for both public and private companies. Beyond providing valuation services for M&A transactions, HG, LLP assists both buy-side and sell-side companies in conducting financial due diligence. The due diligence report includes analyses such as quality of earnings, net working capital, net debt, and more.

To ensure accurate and tailored valuations regardless of the client’s needs, HG, LLP follows a meticulous and client-centric methodology. The process begins with gaining a deep understanding of the client's challenges and needs. Subsequently, a comprehensive data request is initiated to obtain key documentation, including financial statements, trial balances, loan agreements, general ledgers, and more. The data request list also involves solicitating forecasted financials to gain insights into the client's business outlook over the coming years.

Once all the requested documents are consolidated, HG, LLP conducts a thorough review, scrutinizing financial records and contracts to gather essential information about their business and financial situation. As part of the valuation process, its team formulates assumptions related to growth and discount rates, market trends, and other factors that can influence outcomes. These aspects are then rigorously validated and discussed with the client to ensure alignment with their specific business scenario.

A noteworthy story involving a publicly traded client exemplifies the impact of HG, LLP’s capabilities. This engagement involved consolidating the acquired company's financials into the client's financial reports and allocating the purchase price to various assets. The process, marked by extensive historical data verification, presented significant challenges. Skillfully managing this complexity, HG, LLP not only accurately calculated the goodwill during the transaction year, but also evaluated goodwill impairment in the following year due to a significant regulation change. In the process, HG, LLP helped bridge gaps between the client and auditor, resolving disagreements effectively. This collaborative approach ensured accurate determinations of fair values in compliance with the U.S. Generally Accepted Accounting Principles (GAAP). Engagements like these highlight HG, LLP's dedication to results and effective communications in complex financial scenarios.

In an era where markets and business landscapes are in a state of perpetual evolution, HG, LLP continues to be a guiding light for public and private companies seeking financial excellence.