Viewpoint on Value

Showing 353–368 of 378 results

  • Bridging the gap between public and private firms

    May / June 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 708

    Abstract: Transactions of public company shares can sometimes represent good benchmarks for appraisers valuing private businesses, but many privately held business owners wonder whether it’s even possible to compare small businesses with large, publicly traded corporations. While the two types of businesses differ significantly, experienced valuation professionals understand the differences — and how to account for them with well-thought-out, supportable adjustments. This article explains the distinctions between the two types of companies and how appraisers can use public market data as a resource to value even the smallest private company.

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  • Ready, set, go — How to ensure your valuation goes as planned

    May / June 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 905

    Abstract: Miscommunication and ambiguity early in the valuation process can be frustrating and costly later. This article presents some issues business owners and attorneys should discuss with prospective valuators, including the company’s entity type, size and industry classification code, the appropriate standard of value for the purpose, and what type of report format will best suit their needs. The article notes that it’s best to summarize the assignment’s scope and establish an understanding of the appraiser’s duties and responsibilities in an engagement letter up front.

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  • Can goodwill hold up in a bad economy?

    May / June 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 1126

    Abstract: Privately owned companies can’t escape the effects of a slowed economy — for instance, the possibility of impaired values. Goodwill and other indefinite-lived (and long-lived) intangible assets may decline in value. Impaired values might require corrective action to conform with Generally Accepted Accounting Principles (GAAP). This article discusses several recent standards, including Financial Accounting Standards Board Statement of Financial Accounting Standards (SFAS) No. 157, Fair Value Measurements, which provide guidelines for impairment testing. The article points out that valuators are often called in to handle these assignments because they are familiar with current standards and can add objective credibility to the process for auditors.

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  • How to evaluate a distressed business

    March / April 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 381

    Abstract: The tumultuous economy has taken its toll on many private businesses. Weaker companies may be liquidating assets to generate cash flow or even filing for bankruptcy, offering opportunities to stronger players. This brief article notes that even in these cases acquisition due diligence is extremely important to help potential buyers realistically assess the distressed business’s value.

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  • Valuing options: Are you up for the challenge?

    March / April 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 668

    Abstract: Employee stock options (ESOs) can be an effective way for companies to attract and retain key employees and are popular among startups and technology firms, which tend to be cash-poor but offer significant growth potential. But accounting for ESOs became more complicated when the Financial Accounting Standards Board (FASB) issued Statement of Financial Accounting Standards No. 123(R), which eliminated the intrinsic method of reporting ESOs. This article explains that now companies must use the fair value method, requiring ESO issuers to enlist valuation expertise.

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  • Make no mistakes — the IRS means business

    March / April 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 1062

    Abstract: As part of the Pension Protection Act of 2006 (PPA), stiffer penalties await preparers, appraisers and taxpayers who misstate value or sidestep the appraisal process for tax purposes. This article discusses a recent court case that illustrates how overvaluation can prove costly in charitable contribution cases. The article also explains several new rules PPA introduced that revised the thresholds for substantial and gross valuation misstatements, discussing the potential implications for taxpayers. Case citation: Bergquist et al v. Commissioner, 131 T.C. No. 2, July 22, 2008.

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  • Successful succession planning starts today

    March / April 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 1134

    Abstract: U.S. companies currently face an economic crisis unparalleled since the Great Depression: rising energy and commodity prices, increasingly stringent lending requirements, volatile stock market values and a general sense of uncertainty. This article points out that, while many businesses are worth less today than under more favorable market conditions, private business owners now can gift a higher percentage of the business to heirs without incurring federal gift taxes or, possibly, estate taxes. The article notes that this is a good time to start, or revisit, succession plans and lists several ways valuators can help.

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  • Less can be more — When calculations offer an alternative to valuations

    January / February 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 1035

    Abstract: Calculations can be an efficient, economical alternative to detailed, written valuation reports — but only under the right circumstances. This article explains what a calculation is, identifies the pros and cons, and considers some examples of when a calculation might (or might not) work. The article notes that whether or not a calculation will work depends on the engagement specifics, including the appraisal’s intended use, the interest being valued and the availability of information.

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  • Statistics add value to appraisals

    January / February 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 604

    Abstract: Statistical analyses can supplement an appraiser’s professional judgment, adding sophistication and credibility to the business valuation. This article looks at regression analysis and uses an example to illustrate how a regression analysis can help an appraiser build stronger, more defendable valuations. The article points out that regression analysis, like any statistical tool, cannot substitute for a valuator’s judgment and experience.

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  • How fraud affects value — and valuation

    January / February 2009
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 1455

    Abstract: Businesses lose an average of 7% of their annual revenues to fraud, according to the 2008 Report to the Nation on Occupational Fraud & Abuse issued by the Association of Certified Fraud Examiners. This article discusses what fraud consists of, how it may affect value, and how appraisers take fraud risk into account when valuing companies. The article points out, however, that appraisers need to beware of double-counting the effect of fraud risk on value, which may cause them to undervalue business interests.

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  • A closer look at rebuttal reports

    November / December 2008
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 429

    Abstract: Valuators don’t generate a full-blown valuation report for every valuation assignment. Sometimes a rebuttal report will suffice. This brief article summarizes a few scenarios in which a rebuttal report might come in handy, including in unearthing discrepancies and preparing for trial.

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  • Valuators can help smooth the rocky terrain of divorce

    November / December 2008
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 968

    Abstract: Early involvement of financial experts in marital dissolution matters facilitates the discovery process. It encourages information sharing and helps resolve financial settlements. This article uses a fictional case study to illustrate the ways financial experts can help throughout the divorce process from discovery to settlement.

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  • Discounted cash flow basics — A bird in the hand is worth two in the bush

    November / December 2008
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 1020

    Abstract: Valuators use discounted cash flow (DCF) analysis when applying the income approach, which derives value from anticipated future earnings. A key component of any DCF analysis is the discount rate, which is the rate of return used to convert a future monetary sum into its present value. This article describes the ins and outs of discount rates and how valuators support these rates with market data and credible methodology.

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  • When do subsequent events count?

    September / October 2008
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 541

    Abstract: Events that occur after the valuation date — such as key person losses, natural disasters or post-valuation transactions — complicate business appraisals. Fortunately, experienced business valuators understand how to navigate the treacherous waters of subsequent events. This brief article explains some considerations that may cause a valuator to factor a subsequent event into the analysis. Even though valuators generally disregard events that occur after the valuation date, numerous exceptions to this rule exist.

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  • Partner with a valuator — for better and worse

    September / October 2008
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 603

    Abstract: Hiring a valuator early in the bankruptcy process can help preserve asset values, improve the chances of a successful turnaround and maximize liquidation proceeds. For distressed businesses contemplating bankruptcy, liquidation value is an important benchmark. This article discusses the ways valuators can be invaluable advisors throughout the bankruptcy process, helping stakeholders evaluate the viability of purchase offers, management buyouts and reorganization plans.

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  • Convenience has a price — The ins and outs of marketability discounts

    September / October 2008
    Newsletter: Viewpoint on Value

    Price: $225.00, Subscriber Price: $157.50

    Word count: 1026

    Abstract: Marketability discounts capture the inconvenience, time and costs associated with selling a private business interest. This article explains what marketability discounts are and how they work, using a hypothetical example to illustrate. Because such discounts are matters of professional judgment and can vary from one assignment to the next, the article points out that only experienced valuation professionals are equipped to handle them. A sidebar clarifies the difference between marketability and illiquidity discounts.

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