Our Transaction Opinion team collaborates with our internal multi-disciplinary professionals to provide the value analyses and fresh independent opinions to fiduciaries, financing sources and investors for public and private company transactions.
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Serving funds, portfolio companies, and investors across the private equity spectrum.
Our in-house specialists deliver independent fairness and solvency opinions, and valuations investments in businesses, complex financial instruments, intangible assets, machinery & equipment, and real estate.
See below how Marshall & Stevens supports funds and their portfolio companies.
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Our specialists provide internal valuation policy consulting as well as independent valuations of carried interests for compliance with financial and tax reporting requirements and gift tax reporting |
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Our transaction advisory opinions include Quality of Earnings analyses (“QofE”), Fairness Opinions and Solvency Opinions. We are engaged to provide portfolio valuation, positive and negative assurance letters, valuations of GP carried interests, debt and equity instruments. |
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In anticipation of fund wind down, we provide Spin Off / Run Off Valuations, and Fairness Opinions for Continuation Fund transactions. |
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Our transaction opinion professionals assist with target acquisition due diligence (QofE), as well as Fairness & Solvency Opinions |
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Our Financial and Tax Reporting specialists provide Purchase Price Allocations and Valuation of Incentive, Equity, and Debt Instruments. |
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Over the life of the hold, we are engaged for Equity and Incentive Unit Valuations, Impairment Testing, and Transfer Pricing Studies. |
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Over the life of the hold, we are engaged for Equity and Incentive Unit Valuations, Impairment Testing, and Transfer Pricing Studies. |
Marshall & Stevens Insights into Private Equity
Client Highlights
Here are a few client success stories from public and private companies we’ve worked with
We help with questions like
When does a private equity firm need an independent valuation?
Private equity firms typically need independent valuations during acquisitions, financial reporting, recapitalizations, and exit transactions.
Valuations are commonly used for purchase price allocations, portfolio company valuations, equity compensation plans, impairment testing, and complex securities. Independent opinions can also support fairness, solvency, and fiduciary decisions during major transactions.
What are the keys to success for private equity managers today?
The most successful private equity managers combine disciplined investing and operational value creation with strong, audit-ready valuation processes.
As Darleen Armour explains in The Private Equity Playbook, firms are facing greater audit scrutiny and rising LP expectations, which makes calibration, methodological consistency, market-supported assumptions, forecast governance, and proactive auditor engagement increasingly important. Private equity managers that can both grow portfolio company value and support transparent, defensible fair value measurements will be better positioned to build investor confidence and succeed in a more demanding market.
What valuation services are required across the private equity investment lifecycle?
Private equity firms require different valuation services at each stage of an investment.
Common needs include:
| Stage | Valuation Services |
| Acquisition | Fairness opinions, solvency opinions |
| Post-close | Purchase price allocation (ASC 805) |
| Hold period | Portfolio valuations, impairment testing |
| Recapitalization | Debt and equity instrument valuation |
| Exit | Fairness opinions, strategic valuations |
These services support financial reporting, compliance, and investment decisions.
Why does a private equity acquisition require a purchase price allocation?
A purchase price allocation (PPA) assigns the acquisition price to the acquired company’s assets and liabilities at fair value.
Under ASC 805, companies must identify and value assets such as intangible assets, machinery and equipment, and real estate. A PPA ensures accurate financial reporting and establishes future amortization and depreciation schedules.
When are fairness opinions or solvency opinions needed in private equity transactions?
Fairness and solvency opinions help investors and fiduciaries evaluate major transactions.
A fairness opinion assesses whether transaction terms are financially reasonable.
A solvency opinion evaluates whether a company will remain solvent after the transaction.
They are commonly used in leveraged buyouts, dividend recapitalizations, mergers, and related-party transactions.
How are earnouts, management incentive units, and other complex securities valued in private equity deals?
Complex securities in private equity are valued using financial models that reflect performance targets and option-like features.
Typical approaches include:
| Instrument | Method |
| Earnouts | Probability-weighted analysis or simulations |
| Management incentive units | Option pricing models |
| Profit interests | Scenario analysis |
These valuations support financial reporting, tax compliance, and transaction structuring.
What are the pros and cons to having valuations done following private company GAAP vs. full GAAP?
If a company has their purchase price allocation and other financial reporting done for compliance with private company GAAP and then goes public (IPO, SPAC, merger, etc.), the financial reporting will have to be redone and restated to meet the public company standard prior to going public. The initial small cost savings of following private company GAAP for acquisitions is far outweighed by the cost to redo the work in the future.
Is there a material depreciation benefit to stepping up the value of acquired assets on vs taking them over at book value?
We provide preliminary estimates to determine if the fair value step up of the acquired assets is worthwhile to the acquiror.
Why shouldn’t I just rely on a broker or assessor for the real estate value?
Real estate should be looked at strategically for potential beneficial tax reporting, financial reporting, depreciation including cost segregation and bonus depreciation, financing including sale leaseback, etc.
The fair market value of acquired real estate is often much higher than the seller’s capitalized basis and the allocation between land (not depreciable) and improvements (depreciable) is often different than what the assessor has determined.
For financial reporting, the value of acquired real estate needs to be allocated to land, building and improvements, and intangible assets.
How does Marshall & Stevens work with private equity firms?
Marshall & Stevens works with private equity firms by delivering independent valuation and transaction advisory services for acquisitions, portfolio management, and financial reporting. Our services include due diligence, fairness and solvency opinions, portfolio company and fund valuations, and support for complex tax, compliance, and restructuring matters. This helps private equity clients make informed decisions, meet reporting requirements, and support transactions with credible third-party analysis.
How are earnouts, management incentive units, and other complex equity instruments valued?
Each audit firm has their preference for the way certain financial instruments should be valued. We initiate a call with the audit team before performing the analyses to reduce the potential for delays and surprises.
What quarterly marks should be used by valuation specialists to produce reliable, audit-defensible quarterly fair value measurements for private equity?
For audit-defensible quarterly fair value measurements in private equity, valuation specialists should apply a calibrated framework using public comparables, relevant transactions, and, where appropriate, DCF analyses with current assumptions.
Each quarter, valuations must include a clear bridge from prior periods, explaining changes from market movements, company performance, and capital structure, while staying aligned with the original transaction price. Reliable marks also require refreshed market inputs and clear documentation so the valuation can be independently reviewed under ASC 820 or IFRS 13.
