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Acquisition Analysis & Remediation

INQUIRE BEFORE YOU ACQUIRE

Companies acquire other companies for a variety of reasons ranging from a desire to remove industry capacity to improving the performance of one or both companies. In any acquisition, the buying strategy must include a plan for increasing value or it’s not worth doing. Considering this goal, it behooves acquiring companies to determine if any conditions within the target company could offset the achieved value. Matters of unclaimed property present one such condition. 

If unreported unclaimed property remains on the books of a company you hope to acquire, you take on all the problems associated with that condition, including the necessity of facing an audit. If you don’t ask, for all you know, the company you want to acquire already could be scheduled for an audit. Maybe the company has unclaimed property on the books, but no reserve to cover escheat—a liability that can take a substantial chunk out of potential profit.

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An unclaimed property Exposure Assessment helps to determine potential risks.

Use assessment results to make intelligent decisions related to unclaimed property, asking the target company to resolve the issues, reducing your bid or otherwise making a plan to handle the liability and ensure a successful transition.

Why MarketSphere?

If you decide to take on a company with unclaimed property in need of resolution, MarketSphere compliance services can help you bring them into compliance quickly and without placing a huge burden on staff at either company. (They probably are already feeling the stress of completing the acquisition and bringing the new company on board.)

In fact, well before you purchase the new company, you need to be thinking about what it will take to process the company’s due diligence. How much unclaimed property does the organization have each year? Do they use in-house staff to manage it, or do they currently work with a consulting firm? Have all past penalties, fees, interest and escheatment amounts been paid?

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How much unclaimed property does the organization have each year?

Do they use in-house staff to manage it, or do they work with a consulting firm?

Have all past penalties, fees, interest and escheatment amounts been paid?

We Can Help You:

  • Analyze your records to make sure you have identified unclaimed property properly in all business units and locations
  • Complete an Exposure Assessment to determine your risk of audit and liability for costs such as penalties, staff time and elevated escheatment amounts
  • Prepare and send due diligence letters, using your securely exported records, in compliance with all state rules for letter format, content and timing
  • Handle owner responses, so you can avoid time-consuming back-and-forth communication with sometimes irate owners who misunderstand due diligence letters
  • Properly calculate escheatment amounts and prepare state reports to assure seamless compliance and avoid drawing the attention of auditors

Read the blog: Balancing the risks & costs of unclaimed property

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the invisible plan navigating & negotiating unclaimed property for least impact

Are you overcomplying? Undercomplying?

Are you reporting and escheating too many dollars? Or are you reporting too little and risking huge penalties? Take two minutes to take the JustRight Compliance® quiz to find out!

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The project not only helped us to clean up our processes and data, but additionally provided immediate return on investment as promised.

Controller in the Mortgage Banking Industry