Given divergences in both practice and guidance, inventory valuation can seem challenging. In this webinar, Anthony Pumphrey will illustrate simple, straightforward modifications to the valuation of inventory that you can incorporate into your valuation process. Review what comprises the book value of inventory and valuation guidance from the FASB, the IRS, and the AICPA. Next, walk through an example valuation of raw materials, work-in-progress, and finished goods in accordance with this guidance. The example provided will reconcile the top-down (comparative sales) and bottom-up (cost of reproduction) methods. Finally, see an illustrated how-to account for product- and process-specific profit and expenses, reconcile to market participant data, and adjust supporting assets so as to not double count profit.
Program Agenda
What Is Inventory? Review of Definitions, Costs, and Other Attributes of Book Value
Review of Inventory Valuation Guidance (FASB, IRS, and AICPA)
Valuation Methodologies and Practice Considerations
Valuation Walk-Through and Reasonableness Testing
Other Considerations and Impacts on other Assets in an ASC 805 Analysis
Learning Objectives
Understand basic inventory accounting and what is included in the book value of inventory, prior to valuation
Implement relevant guidance into the valuation process in a logical, straightforward manner
Apply the comparative sales and cost of reproduction methods, and clearly identify the components of the inventory step-up
Reconcile the step-up components, supporting assets, and overall analysis with other assets in a business combination
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