Viewpoint on Value
Showing 161–176 of 382 results
-
What’s the outlook for FLPs?
March / April 2017
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 441
Abstract: The viability of family limited partnerships (FLPs) and other family-controlled entities is uncertain. This article discusses recent public feedback to an IRS proposal issued in August 2016 that was intended to curb abusive estate planning practices involving these entities. Despite IRS enthusiasm for the proposal, this article explains how it may not be a priority under the new administration.
-
Consider the cost approach in M&A
March / April 2017
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 591
Abstract: Under the cost approach, a company’s value equals the difference between its combined assets and liabilities. It requires a substantial amount of work to convert a cost-basis balance sheet to the required standard of value. This article explains how buyers and sellers are increasingly using this approach in mergers and acquisitions (M&As) to help compartmentalize the components of value, facilitate discussions about how to structure a deal and prepare for postsale purchase price allocations. This article also covers the basics, including the pros and cons, of this valuation approach.
-
Business valuation pitfalls – 3 reasons earnings may not equal cash flow
March / April 2017
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 640
Abstract: Valuations based solely on oversimplified price-to-earnings multiples won’t pass muster in court — and they should never be the sole method of valuation when pricing a business for sale. This article identifies important considerations that may be missing when the terms “earnings” and “cash flow” are used interchangeably, including capital expenditures, working capital needs and changes in debt.
-
Discounted cash flow vs. capitalization of earnings – How two methods measure up
March / April 2017
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 862
Abstract: Future earnings drive value under the income approach. This article compares and contrasts two methods that fall under this approach: the discounted cash flow and capitalization of earnings methods. A sidebar explains what terminal value is — and how to calculate it.
-
Using a “yardstick” to measure damages
January / February 2017
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 417
Abstract: The yardstick method is a tried-and-true way to measure economic damages in contract breach, patent infringement and other tort claims. This article explains how the method works — and when it might not work as well.
-
Court increases dissenters’ buyout offer by more than 25%
January / February 2017
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 593
Abstract: When computer maker Dell decided to delist in 2013, the deal led to a showdown between management and dissenting shareholders who argued that management’s buyout price was unfair. This article explains why the Delaware Chancery Court decided to base fair value on a discounted cash flow analysis rather than the company’s stock price — and how taxes can have a major impact on value. In Re: Appraisal of Dell Inc., Delaware Ch., C.A. No. 9322-VCL, May 31, 2016
-
See for yourself – Site visits are a critical part of the valuation process
January / February 2017
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 670
Abstract: Financial statements, tax returns and marketing materials tell only part of the story. To get a comprehensive understanding of how a business runs, a valuation expert usually needs to see it — and talk to management — firsthand. This article explains the information that may be unearthed during site visits and the types of questions to expect during management interviews.
-
3 reasons why selling price isn’t necessarily a cash-equivalent value
January / February 2017
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 852
Abstract: When the value of a business is based on the sales of comparable companies under the guideline merger and acquisition (M&A) method, it’s important to understand the cash-equivalent value of comparables. Creative deal terms can make a deal more (or less) valuable than it appears on the surface. This article lists three common reasons why selling price can be misleading: installment sales, earnouts and contractual agreements with sellers. Deals with such terms may require an adjustment to arrive at a cash-equivalent value. A sidebar demonstrates how deal structure can help bridge a bid-ask spread in an M&A transaction.
-
How to estimate reasonable owners’ compensation
November / December 2016
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 428
Abstract: The issue of reasonable compensation often comes up in federal tax inquiries. But it may also be an issue in shareholder disputes and divorce cases. This article identifies factors to consider and reliable sources of comparable compensation data that valuation professionals consider when estimating reasonable owners’ compensation.
-
Assessing fraud risks – Valuation professionals factor fraud into the valuation equation
November / December 2016
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 624
Abstract: When fraud strikes, it can have a major impact on a company’s value. An important part of the business valuation process is identifying potential fraud risks and gauging whether management has taken appropriate action to mitigate those risks. This article explains how valuation professionals conduct a fraud risk assessment that’s customized based on the subject company’s size and industry, as well as what to do when fraud risks materialize.
-
PECO Logistics v. Walnut Investment Partners – Beware of valuation provisions
November / December 2016
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 653
Abstract: A recent Delaware case demonstrates how courts give substantial weight to valuation provisions in owners’ agreements, especially when the experts maintain their independence and follow the terms of these agreements. This article explains the importance of drafting agreements between owners that cover all the value-related bases. PECO Logistics v. Walnut Investment Partners, Del. Ch. C.A. No. 9978-CB, December 30, 2015.
-
Valuation looks to the future, not the past
November / December 2016
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 827
Abstract: When one is valuing a business, historical results are only relevant to the extent that similar results are expected in the coming years. This article explains how business valuators handle major changes to a subject company’s internal and external market conditions, such as the U.S. Department of Labor’s (DOL’s) new overtime regulations. A sidebar highlights the perils of valuing a business based on oversimplified forecasts.
-
Relying on management’s estimates of expected cash flow
September / October 2016
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 437
Abstract: Often, business valuations are based on estimates of expected cash flow, but it’s important to evaluate whether these estimates seem reasonable. This article explains the role that cash flow estimates play in valuing a business and the difference between forecasts and projections.
-
Spotlight on the market approach
September / October 2016
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 626
Abstract: There are three general ways to value a business: the cost, income and market approaches. This article focuses on the market approach, comparing and contrasting two methods that fall under it: the M&A method and the guideline public company method. Both have intuitive appeal, as well as various downsides, so they’re not applicable in every valuation assignment.
-
Define it before you assign it – A business interest can have many different levels of value
September / October 2016
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 657
Abstract: Control and marketability are two key issues when valuing a private business interest. Before your valuation expert starts gathering information to value a business, he or she must decide on the appropriate “level of value” based on the purpose of the appraisal and the characteristics of the ownership interest. This article explains the three levels of value and how control and marketability factor into each level.
-
Deal of a lifetime – Market a business to maximize its selling price
September / October 2016
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 874
Abstract: When it’s time to sell, how a private business is marketed can have a significant impact on the cash available for distribution to owners. This article discusses current M&A trends, methods for establishing a reasonable asking price and why it’s important to do one’s homework before seeking prospective buyers. A sidebar discusses the tempered market response to the new online equity crowdfunding rules that recently went into effect.