Completion accounts are a very common form of purchase price adjustment mechanism used in M&A transactions. The intention is to verify that the actual financial position of the target company at completion is in fact what the parties expected when, on the basis of historic financial information, they signed the deal.

What is included in completion accounts?

What are 'completion accounts'? At its most basic, completion accounts are simply a set of accounts that are drawn up for the purpose of the sale / acquisition and then used as a basis for adjusting the price.

What is a completion accounts mechanism?

A completion accounts mechanism requires that the parties record their understanding and agreement as to how these various matters are to be treated in the completion accounts and therefore how they are to potentially adjust the price.