Valuation Concepts
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Showing 1–16 of 29 results
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For What It’s Worth: Valuation in the Courts – FAMILY’s FLP foibles serve as a cautionary tale
Summer 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 500
Abstract: If there’s a silver lining to a gloomy economy, it may be the estate planning opportunities that arise. Currently, many wealthy individuals are creating family limited partnerships (FLPs) to take advantage of lower market values and slowed transaction activity. But they must be structured carefully to avoid IRS challenge, as one family found out in Estate of Thelma G. Hurford v. Commissioner.
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4 keys to authenticating electronically stored information
Summer 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 501
Abstract: Electronically stored information (ESI) plays a prominent role in today’s litigation but, like any evidence, it must meet the authentication threshold before it will be admitted at trial. Qualified experts can apply many technological tools to establish the authenticity of ESI. It’s important, however, to understand the limits of such tools, whether arguing for or against the authenticity. This article provides an overview of four tools that can prove critical to ESI authentication.
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Valuation methodology – The market approach proves informative, challenging
Summer 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 779
Abstract: When helping to take a business to market (or helping someone buy a business), appraisers often employ the market approach. Unlike the other two primary valuation methods, the income and asset approaches, the market approach looks to similar businesses to estimate a company’s fair market value. This article reviews the market approach as well as two variations on it, the transaction method and the guideline public company method.
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When prevention fails … Jointly published guide details fraud detection techniques
Summer 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 1044
Abstract: No organization can ever completely eliminate the risk of fraud in its business — even when preventive measures have been put in place — which makes timely detection crucial. Managing the Business Risk of Fraud: A Practical Guide, jointly published by several industry associations, offers valuable information on the detection techniques a fraud expert might employ. This article discusses some of those techniques, such as whistleblower hotlines, process controls, documentation methods and several proactive measures. A sidebar lists 10 criteria for evaluating fraud detection techniques.
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For What It’s Worth: Valuation in the Courts – Recent FLP case illustrates IRS attack strategies
Spring 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 623
Abstract: For attorneys, an in-depth understanding of recent case law regarding family limited partnerships (FLPs) is a prerequisite to helping clients with these estate planning vehicles. One recent case, Holman v. Commissioner, shows a few strategies the IRS may use to challenge an FLP.
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ACFE study quantifies employee fraud
Spring 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 607
Abstract: The Association of Certified Fraud Examiners’ latest Report to the Nation on Occupational Fraud and Abuse estimates that U.S. organizations lost about 7% of their annual revenues — or $994 billion — to fraud in 2008. And the most costly form of fraud involves misstated financial statements. Understanding the most common types of fraud and their costs can make it easier to identify these costly schemes. This article details some of the statistics.
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What standard should be used for divorce valuations? – Fair market value vs. fair value
Spring 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 1031
Abstract: Courts have typically applied the fair market value (FMV) standard to estimate the value of businesses in divorce proceedings. Recently, however, attorneys for nonowner spouses have been increasingly requesting the use of the fair value (FV) standard. This article looks at a variety of cases over the last couple of decades. The arguments are worth noting, as the monetary difference between FMV and FV — for both owner and nonowner spouses — can prove substantial.
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E-discovery: Avoiding inadvertent disclosure
Spring 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 355
Abstract: Electronic evidence has assumed a prominent role in discovery. In turn, the massive amounts of data in such evidence have increased the risk of inadvertent disclosure of privileged materials. But savvy attorneys can use technology to screen evidence for potentially privileged materials. This short article offers tips.
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Preparing for the unexpected – Buy-sell agreements can steady businesses in uncertain times
Spring 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 768
Abstract: To guard against the negative consequences that could arise from events such as the death or disability of a partner, the divorce of a family business owner, or a shareholder dispute, companies need to be prepared. A buy-sell agreement can steady a business in uncertain times, and valuation considerations play an integral role in effective agreements. This is why an appraiser is needed to address areas such as insurance coverage, buyout terms, and choosing the correct standard of value. A qualified appraiser also knows how to avoid simplistic or outdated formulas in determining the appropriate value.
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For what it’s worth: Valuation in the courts – IRS plays role reversal in charitable contribution case
Winter 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 616
Abstract: In charitable contribution cases, taxpayers want property appraised as high as possible to maximize their deductions. Meanwhile, the IRS seeks low appraisals for assets donated to charities to maximize tax receipts. But, in a recent charitable contribution case, the IRS reversed its usual role, arguing in favor of hefty discounts for lack of control and marketability. The result may be surprising. Citation: Bergquist, et al v. Commissioner, 131 T.C. No. 2, July 22, 2008.
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What factors determine company-specific risk?
Winter 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 700
Abstract: Valuation is both art and science. When financial data and empirical research aren’t enough, appraisers typically make subjective assessments to bridge the gap — for example, when quantifying company-specific risk. This article looks at what factors appraisers consider to estimate company-specific risk.
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FASB 141(R), Business Combinations – Revised accounting standard has valuation implications
Winter 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 1191
Abstract: The accounting rules for mergers, acquisitions and other types of business combinations underwent a major overhaul in December 2007. The revised standard, Financial Accounting Standards Board (FASB) Statement No. 141 (revised), Business Combinations, or FASB 141(R), is effective for fiscal years beginning after December 15, 2008. This article revisits the subject of business combination in light of the new standard, exploring its valuation implications.
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Turning a critical eye … 7 questions to ask about an appraisal report
Winter 2009
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 784
Abstract: The content and format of business valuation reports may differ somewhat depending on appraiser preferences, firm protocol and the requirements of any professional organizations to which the appraiser belongs. But many of the underlying analyses and explanations are similar. This article suggests seven questions to ask that can help ensure an appraiser has covered all the bases.
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For what it’s worth: Valuation in the courts – FLP discounts and the multitiered company
Fall 2008
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 653
Abstract: In this issue’s “For what it’s worth: Valuation in the courts,” we look at the long contentious issue of family limited partnerships (FLPs). Gifts of FLP interests allow individuals to transfer wealth at often substantial discounts from the FLP’s underlying net asset value. And this recent Tax Court case provides insight into how the court handles discounts for lack of control and marketability — especially when multiple owners are involved. Citations: Astleford v. Commissioner, T.C. Memo 2008-128, May 5, 2008.
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Personal vs. business goodwill: The appraisal challenges
Fall 2008
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 788
Abstract: One might associate business appraisals with accounting, yet, in truth, they’re worlds apart. Financial statements, for example, tell only part of the story, and intangible assets present even greater valuation challenges. Items such as patents, customer lists, leases and brand names can be readily identified and valued. But what’s left over — commonly referred to as “goodwill” — may require special treatment. This article compares two distinctive forms of goodwill: personal and business. (Updated 11/14/12)
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The market approach – An increasingly effective way to value businesses
Fall 2008
Newsletter: Valuation Concepts
Price: $225.00, Subscriber Price: $157.50
Word count: 1156
Abstract: The market approach is an intuitive way to value a private business interest. It bases the subject company’s price on sales of other similar businesses or business interests, which are commonly referred to as “guideline transactions” or “comparables.” Of course, no two businesses are exactly the same, so identifying a perfect match is impossible. This article examines why and how the market approach works anyway.