FVC2442. How to Treat “Right of Use” Assets in Valuations

This session will utilize a case study format to delve into the alternatives for valuing companies with significant "right of use" assets. Along the way, we'll cover the key changes in lease accounting pursuant to ASC 842 and discuss factors that valuators should consider when performing such valuations.

Learning Objectives:

• Identify the rationale for recording right-of-use assets and the implications for valuation analysts.
• Identify the two primary alternatives for dealing with right-of-use assets in a valuation analysis.
• Recognize where information related to operating and finance leases are located within financial statements for both private company targets and public company comparables.
• Identify necessary adjustments for performing the income/market approaches using earnings/multiples that are net or gross of lease-related items.