Portfolio companies: Acquisition to exit
Hot Topic | November 2025
Our Hot Topic provides critical insights into a portfolio company’s key accounting and reporting issues during a PE firm’s investment.
We address the complexities of acquisition accounting, share-based payments, SEC reporting and internal controls and other complex financial reporting issues portfolio companies face from acquisition to exit.
Applicability
- Leadership teams of private equity portfolio companies.
Key impacts:
Private equity (PE) portfolio companies (PortCos) face distinct and complex challenges throughout the life cycle of the PE’s investment. From the PE’s initial acquisition to eventual exit, a PortCo must navigate unique accounting and reporting issues while implementing operational improvements and strategic initiatives aimed at enhancing value. This Hot Topic discusses common accounting and financial reporting issues that a PortCo is likely to face during the life cycle of the PE’s investment.
PEs typically use investment funds that may be considered investment companies for accounting purposes. This Hot Topic is not focused on the accounting for the investments at the PE fund level. See our Investment companies handbook for further information about the accounting at the PE’s investment fund level when the PE is considered an investment company.
Report Contents
- Initial acquisition
- Compensation arrangements
- Initial public offering
- Exit by sale
- Other issues
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Portfolio companies: Acquisition to exit
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