Speak To One Of Our Accountants: (713) 780-0806
Our answer to the challenge of valuing embedded derivatives
Our valuation report provides you with everything you need to record your derivatives:
We provide you with a clear explanation of our methodology and assumptions so that your auditors get a complete set of all reports and documentation.
ASC 815, formerly known as FAS 133, Accounting for Derivative Instruments and Hedging Activities, provides comprehensive guidance on derivative and hedging transactions. It sets forth the definition of a derivative instrument and specifies how to account for such instruments, including derivatives embedded in hybrid instruments. An embedded derivative is a contract that contains implicit or explicit terms that affect some or all of the cash flows or the value of other exchanges required by a contract in a manner similar to a derivative instrument. A derivative instrument often arises from a convertible note payable with a variable conversion price. These instruments are required to be valued at fair market value. Classically, there are two methods in use for valuing a derivative, Black-Scholes-Merton (BSM) and Binomial lattice models.
We remember your existing instruments, so you only need to provide new notes and transactions. You don’t even need to delete paid-off notes – enter the transactions that take the principal balance to zero, and the system does the rest.
CPR-Serviced: Send us copies of the documents that gave rise to the deriviative and source documents for any transactions that occurred during the period - such as note agreements, warrants, options, or conversion notices, exercise notices and we send you a complete valuation report for a fixed fee of $3,000*, within 3 business days.
There are no additional costs for volume of transactions. Our app doesn’t care how many there are!
*Our prices are based upon receiving a complete data set from you BEFORE we run the program. If you discover that you did not send us a complete data set and that we must rerun the report, we charge $500 each time an additional run is required.