Why PPA Engagements Cost What They Do
Cross-border M&A purchase price allocations require identifying and valuing intangibles — customer relationships, developed technology, trade names — using methods like relief-from-royalty and multi-period excess earnings (MPEEM). At $100k–$600k per transaction, outside valuation firms charge for both the technical methodology and the institutional knowledge needed to apply it consistently across deal structures. For a serial acquirer, that institutional knowledge already exists inside the organization. The problem is that it lives in prior engagement letters and review emails rather than in a system that can execute the workflow.
How an AI Agent Handles the ASC 805 Workflow
An AI Labor Company agent mines your prior ASC 805 PPA engagement letters and opening-balance-sheet review emails to reconstruct the post-close workflow your team has already ratified with auditors. A managed agent then ingests the target's GAAP balance sheet and deal model, identifies and values customer relationships, technology, and trade-name intangibles using relief-from-royalty and MPEEM — the same methods your outside firm uses — and assembles the PPA summary for CAO review. The output routes to you before any external auditor interaction or Form 8-K/A filing. Typically live in 8 weeks.
The Business Case Across a Deal Portfolio
At the per-transaction level, illustratively 50–70% of the hours currently going to outside valuation advisors shift to the agent. For a serial acquirer doing three to five transactions per year, that adds up to a material reduction in deal costs — and a faster path to filed financial statements. The less obvious benefit is consistency: an agent applies the same methodology across every deal, which simplifies auditor sign-off over time. When your auditors recognize a familiar, well-documented PPA approach, the back-and-forth shrinks.
Will our external auditors accept valuations produced by an AI agent?
The CAO reviews and approves all outputs before auditor submission. The agent produces the analysis; you own the conclusion. Most audit teams care about methodology consistency and documentation — both of which the agent is designed to support. That said, your audit team's specific expectations should be confirmed during onboarding.
How does the agent handle deal-specific complexity, like contingent consideration or step acquisitions?
The agent's workflow is configured based on your existing PPA patterns. Unusual deal structures — earnouts, step acquisitions, pre-existing relationships — are flagged for CAO review rather than handled autonomously. The agent handles the repeatable core; edge cases route to your team.