Playing many roles — Reasonable compensation keeps appraisers busy

Description

Abstract: It’s an issue that comes into play in divorce, shareholder disputes and tax cases. It’s also a common financial statement adjustment appraisers make when valuing a business. The issue, of course, is reasonable compensation. This article examines the wide variety of factors appraisers weigh when determining reasonable compensation for a specific business owner. It offers a fictitious case study involving a divorce proceeding, where owners’ compensation calculations can dramatically affect property settlements and support payments.