Effective in June of 2023, Carta changed the way that certain valuation reports are being presented, and in some cases the valuation reports state that the 409A valuation performed by Carta may not be able to be used to support share-based compensation reporting under Accounting Standards Codification 718. We are encouraging our clients to reach out to Carta to understand any changes that are being made from the historical reports and those now currently being presented.
For our clients who record share-based compensation expense based on Carta’s information, we encourage you to review the share-based compensation calculations in detail to understand if there are changes to the methods that are being used compared to prior years. Our hope is to ensure that our clients are ahead of any possible issues prior to their 2023 audits to avoid any audit delays or challenges.
As always, please feel free to reach out to KN+S!
Bryan McKeon, CPA, MSA, is an Assurance Partner at Katz, Nannis + Solomon, P.C. If you have any questions or would like to speak with one of our tax professionals, please contact our office at 781-453-8700.