US 409A vs. Indicated Value Reports: Same Valuation, Different Report
A 409A is a US label. Outside the United States, the same private-company valuation is delivered as an Indicated Value report. Here is what actually changes across jurisdictions — and what stays exactly the same.
Key Takeaways
- check_circleA 409A valuation is a United States label — it is the IRC Section 409A report for the fair market value of common stock used to set option strike prices.
- check_circleOutside the US, the same private-company valuation is typically delivered as an Indicated Value report, denominated in the local currency and framed for the local regulatory and accounting context.
- check_circleThe underlying valuation engine is identical across jurisdictions: the same methods (DCF, market comparables, OPM Backsolve, post-money), allocation engines, and marketability discount.
- check_circleWhat changes by jurisdiction is the report label, the regulatory wrapper, the currency, and certain disclosure conventions — not the math.
- check_circleUS fair-value and stock-compensation reports (ASC 820 and ASC 718) have international counterparts under IFRS (IFRS 13 and IFRS 2) that measure the same economics.
- check_circleFirms operating across borders benefit from running every engagement on one engine, so a US 409A and an international Indicated Value report are reconcilable and consistent.
A founder in Bengaluru and a founder in San Francisco can run the exact same business, raise the exact same round, and need the exact same number — the fair value of their common stock. Yet one receives a document called a "409A" and the other receives an "Indicated Value report." The difference is not the rigor of the analysis. It is the jurisdiction. This guide explains what a 409A actually is, why the term does not travel outside the United States, and precisely what changes — and what does not — when the same company is valued in two different countries.
One valuation engine, many report labels
Every private-company valuation answers the same economic question: what is this company worth, and how is that value distributed across its share classes? The work of answering it — selecting valuation methods, weighting them, allocating value across preferred and common stock, and applying a discount for illiquidity — is jurisdiction-neutral. It reflects the economics of the business, not the filing rules of a single country.
What differs from one country to the next is the wrapper placed around that conclusion: the report's name, the regulatory or tax framework it satisfies, the currency it is expressed in, and the disclosures it must carry. The underlying methodology stays constant; the label changes.
The US standards: 409A, ASC 820, and ASC 718
In the United States, the report you need depends on why you need the valuation. Three labels cover most private-company work, and each maps to a specific purpose.
| US standard | What it is for | Typical user |
|---|---|---|
| IRC 409A | Fair market value of common stock to set defensible stock-option strike prices (safe harbor under the tax code) | Startups and private companies granting options |
| ASC 820 | Fair value measurement for financial reporting, fund NAV, and portfolio holdings | VC and PE funds, auditors, controllers |
| ASC 718 | Fair value of share-based payment for compensation expense (ESOP accounting) | Companies expensing equity compensation |
These are three different report wrappers around the same kind of analysis. For a full walkthrough of the 409A wrapper specifically — including safe harbor and refresh timing — see our guide on what a 409A valuation is.
Outside the US: the Indicated Value report
Outside the United States, there is no "409A." The term is specific to a section of the US Internal Revenue Code and simply does not apply elsewhere. In India and many other jurisdictions, the same private-company valuation is delivered as an Indicated Value report: a conclusion of value reached with the same methodology, denominated in the local currency, and framed for the local regulatory and accounting context.
Fair-value and stock-compensation reporting also have international counterparts. The US GAAP standards ASC 820 (fair value measurement) and ASC 718 (share-based payment) correspond to IFRS 13 and IFRS 2 respectively. They are written for different reporting frameworks, but they measure the same underlying economics — which is why a single, well-built valuation analysis can support either side.
What changes by jurisdiction — and what does not
| Element | Changes by jurisdiction? |
|---|---|
| Report label (409A, ASC 820, ASC 718, Indicated Value) | Yes — the name reflects the local framework |
| Regulatory or tax wrapper and disclosures | Yes — each jurisdiction has its own conventions |
| Reporting currency | Yes — local currency, multi-currency supported |
| Valuation methods (DCF, comparables, OPM Backsolve, post-money) | No — the same methods apply everywhere |
| Equity allocation across share classes (OPM, CVM, CSE) | No — driven by the cap table, not the country |
| Discount for lack of marketability (DLOM) | No — reflects illiquidity, not a filing rule |
Why this matters for firms operating across borders
A valuation firm or finance team that works in more than one country faces a consistency problem: if a US 409A and an international Indicated Value report are produced in different tools, with different assumptions, they will not reconcile. Running every engagement on one engine solves this.
- Consistency: the same company valued in two jurisdictions produces reconcilable conclusions, because the methodology is identical.
- Defensibility: a single, auditable methodology trail supports both the US filing and the international report.
- Efficiency: the analysis is performed once; only the report wrapper and currency change.
- Scale: multi-currency and multi-jurisdiction engagements run side by side rather than in separate, divergent models.
The bottom line
"409A" is a US label, not a global one. The international equivalent is an Indicated Value report — same valuation engine, local currency, local framing. Treat the methodology as the constant and the report as the variable, and cross-border valuation becomes a matter of choosing the right wrapper rather than rebuilding the analysis. For a deeper look at the methods and standards behind every report, see our overview of valuation methods and standards, and for the US fair-value wrapper specifically, our guide to ASC 820 fair value measurement.
Frequently Asked Questions
What is the international equivalent of a 409A valuation?expand_more
There is no single global equivalent, because 409A is a US tax-code label specific to IRC Section 409A. Outside the United States, the same private-company common-stock valuation is generally delivered as an Indicated Value report, prepared in the local currency and framed for the local regulatory and accounting context. The valuation methodology used to reach the conclusion is the same; only the report label and wrapper differ.
Is an Indicated Value report less rigorous than a 409A?expand_more
No. An Indicated Value report uses the same analytical engine as a 409A — the same enterprise-value methods, the same allocation across share classes, and the same marketability discount. It is the jurisdiction-neutral term for the conclusion of value when the engagement is not specifically a US IRC Section 409A filing.
How do ASC 820 and ASC 718 relate to international standards?expand_more
ASC 820 (fair value measurement) and ASC 718 (share-based payment) are US GAAP standards. Their international counterparts under IFRS are IFRS 13 (fair value measurement) and IFRS 2 (share-based payment). They are written for different reporting frameworks, but they measure the same underlying economics, so a single valuation analysis can support either.
What actually changes when the same company is valued in two countries?expand_more
The report label, the regulatory and tax wrapper, the reporting currency, and some disclosure conventions change. The valuation methodology — the selected methods, their weighting, the equity allocation, and the discount for lack of marketability — does not change, because it reflects the economics of the company rather than a single country's filing rules.
Can one platform produce both a US 409A and an Indicated Value report?expand_more
Yes. When both reports run on the same engine and the same finalized cap table, the conclusions are consistent and reconcilable. The platform applies the same methods and allocation, then wraps the output in the correct report template — a 409A, an ASC 820 or ASC 718 report in the US, or an Indicated Value report for India and the rest of the world.
Pre-quote 409A diligence in 12 items
Independence conflicts, methodology constraints, and material events to verify before scope is agreed. Six pages, twelve verifiable items, every claim sourced.
