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Program Description
Companies may issue options, warrants, convertible debt, and convertible preferred securities with exotic derivatives features such as a resetting of the strike price or a change in the number of equivalent shares based on market conditions. This webinar will discuss some of the most common embedded features encountered in valuation for financial reporting. It will provide illustrative excerpts from SEC filings describing such features. The presenters will show how to value securities with embedded features using Monte Carlo simulation, a flexible methodology well suited to valuing such contractual features.
Learning Objectives
After completing this webinar, attendees will be able to:
- Identify the embedded derivatives in securities purchase agreements
- Detect how embedded features add to or subtract from a simple Black-Scholes option valuation
- Compare the Black-Scholes Model with the Monte Carlo simulation model
- Implement options/warrants/convertibles with the embedded features using Monte Carlo
Who Should Attend
Attorneys, valuation practitioners, CPAs
Presenter(s)
Dan McConaughy, ASA, PhD
Dr. Dan McConaughy is editor of Business Valuation Review, professor of finance at the David Nazarian College of Business and Economics at California State University Northridge, and is a director in valuation services at Crowe Horwath, LLP. He has published extensively in academic finance and practitioner valuation journals. He has presented at NACVA and ASA conferences as well as in webinars related to valuation.
Vincent Covrig, CFA, PhD
Dr. Vincent Covrig is a senior consultant in Crowe Horwath’s valuation services practice. His expertise is in modeling of fixed income securities, financial derivatives, compensation awards, enterprise valuation and allocation models, and contingent considerations. He is also a finance professor at California State University, Northridge, and has published more than a dozen papers in top academic and practitioner journals. He has presented at ASA and NACVA conferences. The subjects of his valuation assignments have included entire enterprises and partial business interests, preferred and debt securities, portfolios of assets, derivative instruments, and intangible assets. He has conducted SAS 73/SAS 101 reviews of investment valuations for hedge funds and private equity firms and examinations of third-party valuation specialist reports in the context of financial statement audits.
CPE Credit |
Dan McConaughy, ASA, PhD
Vincent Covrig, CFA, PhD
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