Within the context of a merger, is it always necessary to consult a contribution auditor for asset transfers and mergers?

This is a complex question, requiring a case-by-case study of the appropriate degree of intervention. It may not be compulsory, although it is perhaps advisable in order to make the operation more secure, particularly from a taxation point of view.
A statutory auditor will be better able to study the context and confirm the scope of the operation.

What are the roles of the merger auditor and the asset transfer auditor?

Merger auditor pay particular attention to the exchange parities. In particular, they check whether there is a violation of the equality between the long-term shareholders that would result in a lasting impairment of the position of one category of shareholders. To this end, they examine the status of the categories concerned before and after the transaction. This economic insight enables the shareholders to reach a fully informed decision.

The asset transfer auditor verifies whether the assessments adopted are not overvalued. Being a member of the college of appraisers of the French Association of Financial Consultants and Appraisers (CCEF) is a plus for this activity requiring the use of valuation skills.

Can the company’s chartered accountancy firm manage the asset transfer and merger operations in their entirety?

No. The chartered accountancy firm cannot be both judge and jury in the context of asset transfer and merger operations. The intervention of the contribution auditor for asset transfers and mergers enables a second-tier external control and evaluation that is complementary to the work carried out by the accounting firm.

Fabrice Vidal is a partner and member of Caderas Martin’s Board of Directors and also of the panel of appraisers of the French Association of Financial Consultants and Appraisers (CCEF). He has particular expertise in business valuations and damage assessment.

Fabrice Vidal and his colleague Maud Bodin facilitated a workshop dedicated to merger and asset contribution audits for their colleagues at the Summer Conference of Chartered Accountants in early September 2021.

Their material is still available online by clicking here https://cdn-assets.inwink.com/919db1f2-5fe7-468a-a9f5-3dc544f134e8/ae41c980-32d9-46f4-8386-4943923bb91d