Earnouts and the Monte Carlo Method: Practice Tips for Implementation

Business Valuation UpdateVol. 24 No. 5
May 2018
Erica Wilson
Vincent Biemans
fair value for financial reporting
purchase price allocation, fair value, fair value measurements, monte carlo


Practice tips to use when implementing a Monte Carlo method (MCM) analysis to value earnout rights or obligations, plus a brief overview of earnout provisions and the MCM.