Viewpoint on Value
Showing 193–208 of 382 results
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Back to basics – When to consider ex post facto information
November / December 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 435
Abstract: Should business appraisers consider major events that occur after the valuation date? For example, what if a business is subsequently sold, files for bankruptcy, or experiences a major fraud loss, data breach or natural catastrophe? All of these events could potentially affect fair market value, but this article provides an overview of when to include (and exclude) ex post facto information from the valuation analysis.
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What’s the value of my franchise?
November / December 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 580
Abstract: The International Franchise Association estimates that there are currently more than 2,000 different brands operating over 700,000 franchised units in the United States. Based on the number of people who own franchises, it may seem like an easy route to owning a private business. But not all franchises are created equal. This article discusses the unique challenges and considerations that go into valuing a franchise, as well as the top five franchise industries in 2015 based on owner satisfaction.
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Spotlight on reasonable pay – IRS job aid can be a useful resource for estimating owners’ compensation
November / December 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 709
Abstract: Last fall, the IRS published Reasonable Compensation: Job Aid for IRS Valuation Professionals to help field agents audit owners’ compensation. Business valuators also use the job aid to help owners know how much their contributions are worth in today’s marketplace, based on their duties, skills and experience. This article provides an overview of how the IRS and valuators systematically approach this large discretionary expense and why it’s important.
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Year end gifts: Valuing a business for transfer tax purposes
November / December 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 854
Abstract: The end of the year is a time for gift giving. Over time, annual gifts of closely held business interests add up and can substantially lower the amount of taxes that a business owner’s estate will eventually owe. This article explains how estate planning tools can be used to lower estate tax costs and why it’s important to obtain a qualified appraisal from a qualified appraiser to support fair market value estimates. A sidebar discusses how the IRS may limit valuation discounts on transfers of closely held business interests in the future.
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Back to basics – Getting a handle on terminal value
September / October 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 435
Abstract: The discounted cash flow method derives value from a company’s expected future earnings. But many businesspeople don’t realize that 50% (or more) of the value under this method typically resides in the present value of the subject company’s “terminal value.” This article explains what terminal value is, how it’s calculated and how it can be tested for reasonableness.
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Visual aids: A picture can be worth 1,000 words
September / October 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 565
Abstract: Business appraisers who serve as expert witnesses in court face two daunting tasks: They must capture the attention of a judge or jury and make complex financial analyses easy to understand. This article provides tips on how to use impactful visual aids to break up the monotony and drive home key points in an expert’s oral testimony and written reports.
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Ready to grow – Valuators can help evaluate internal and external investment alternatives
September / October 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 700
Abstract: Now that the economy is picking up, owners and managers may be brainstorming ways to grow the business. This article explains how valuators can provide objective insight into which internal and external growth strategies make the most sense from a financial perspective — rather than relying on gut instinct.
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How much does human capital add to a company’s value?
September / October 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 846
Abstract: “Human capital” is often one of the most valuable — and difficult to replicate — resources that companies own. It includes a trained and assembled group of workers who know how to operate equipment, follow the company’s policies and procedures, innovate to build new products and services, and work together as a team to achieve the company’s strategic goals. This article explains the types of human capital assets and common ways to value them. A sidebar outlines the top reasons valuators may be asked to value human capital assets.
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Back to basics – Blending appraisal disciplines to value fractional interests in real estate
July / August 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 450
Abstract: Valuing undivided interests in real estate requires the use of a real estate appraiser to value the underlying property. Then, a business valuator is needed to determine the appropriate discount for owning a fractional interest in the property. This discount differs from the discounts associated with owning minority interests in closely held businesses. This article discusses the general factors to consider and a common method to use when quantifying fractional interest discounts for real estate.
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Cavallaro v. Commissioner – Faulty assumption causes court to discard petitioners’ appraisal
July / August 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 597
Abstract: A recent Tax Court case demonstrates that a valuation is only as reliable as its underlying assumptions. A faulty assumption can undermine the credibility of an appraiser’s testimony and leave the court to rely solely on the opposing expert’s conclusion. This article discusses the facts and circumstances that led the Tax Court to discard the petitioners’ appraisal and explain how a merger between two family businesses resulted in constructive gifts to the petitioners’ sons. William Cavallaro, et al. v. Commissioner, T.C. Memo 2014-189, Sept. 17, 2014
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Look to the future when estimating net cash flow
July / August 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 673
Abstract: When valuing a business, historic financial performance is relevant only if the entity’s future performance will mirror the past. For many companies — such as those with negative historic cash flow, start-ups and merged entities — valuators may need to build more detailed cash flow estimates or rely on management’s estimates. This article defines equity and invested capital net cash flow, differentiates forecasts and projections, and explains how small differences in estimating cash flow can have significant impacts on value.
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How does industry risk impact business valuation?
July / August 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 850
Abstract: There’s a trade-off between risk and return in business valuation. Investors expect to receive a higher return as the company exposes them to greater risk. Industry-specific risk is an important consideration when estimating an investor’s expected return. This article explains how business valuators measure industry risks and factor them into their analyses. A sidebar highlights the importance of defining the subject industry correctly.
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Back to basics – Why ESOPs need appraisals
May / June 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 425
Abstract: ESOPs provide tax-saving opportunities for business owners who want to cash out and transfer ownership to employees without immediately giving up control of the business. This article discusses the valuation challenges that ESOPs present to the fiduciaries who administer them, especially when the sponsoring company is privately held. Fifth Third Bancorp v. Dudenhoeffer (U.S. Supreme Court, No. 12-751, June 25, 2014)
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Wright v. Irish: Which expert is right?
May / June 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 600
Abstract: For a variety of reasons, valuation experts sometimes arrive at widely divergent conclusions. Perhaps two qualified experts relied on different assumptions and facts. Or maybe one expert failed to perform in-depth analyses, made an overt error or used an appraisal technique that isn’t widely accepted in the valuation community. This article highlights a recent case that outlines common reasons for gaps between dueling experts — and helps explain why courts may decide to side with one expert over another. John Wright v. Jeffrey B. Irish and Mary Irish, NY Sup. Ct., Index No. 2111/2014, Nov. 7, 2014.
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SBA 7(a) program loans – Understand the valuation requirements before applying
May / June 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 658
Abstract: The flagship of the SBA loan program — 7(a) guaranteed loans — was more popular than ever in 2014. Under the 7(a) program, the SBA guarantees a portion of the money that banks lend to small businesses. But approval requires significant red tape. For some transactions — including qualifying mergers, acquisitions and related-party transactions — lenders are required to request independent business valuations, which catches some small business owners off guard. This article answers some frequently asked questions about the SBA’s appraisal requirements.
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Casting a spotlight on the guideline M&A method
May / June 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 847
Abstract: Real-world M&As can provide a wealth of objective data for valuing a private business. But comparable deals are relevant only to the extent that they’re similar to the subject company. This article provides an overview of how the guideline M&A method works and how valuators cull transaction data to arrive at reliable estimates of value. A sidebar discusses possible sanity checks that appraisers can use to double-check whether their conclusions make sense.