Viewpoint on Value
Showing 209–224 of 382 results
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Back to basics – Review statements of limiting conditions for weaknesses
March / April 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 431
Abstract: Most valuators attach statements of limiting conditions to the end of their written reports. Similar to financial statement footnotes required under Generally Accepted Accounting Principles, these appendices are worth reading, especially when one is reviewing the opposing expert’s report. This article notes some of the potential weaknesses or incomplete analyses that could discredit a valuator on the stand.
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No clear-cut answers to the tax-affecting dilemma
March / April 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 621
Abstract: Pass-through entities — such as partnerships, S corporations and limited liability companies — aren’t subject to corporate-level income taxes. Instead, their income “passes” onto the shareholders’ personal tax returns based on their respective equity interests in the company. But is this favorable tax treatment valuable in the eyes of hypothetical investors? Tax-affecting remains a controversial topic that requires careful consideration when one is valuing these types of businesses. This article discusses how different courts have been handling the issue.
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Potok v. Rebh – What’s the value of personal goodwill?
March / April 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 574
Abstract: Personal goodwill belongs to employees or shareholders, not companies. But this article examines a recent dissenting shareholder case demonstrating that, when a company is sold, the value of personal goodwill may be limited to the extent that key people enter into noncompete and consulting agreements with the buyer. The case shows that, when one is valuing personal goodwill in dissenting shareholder cases, fairness and reasonableness are overriding concerns. Fred Potok v. Richard Rebh, et al, 2014 Phila. Ct. Com. Pl. LEXIS 318, Sept. 16, 2014. Martin Ice Cream v. Commissioner, 110 T.C.189
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Factoring taxes into divorce settlements
March / April 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 842
Abstract: How assets are split up in a divorce can have significant tax consequences, especially when the marital estate includes a private business interest. Valuation is just part of the picture. Equitable distributions require the parties to premeditate tax issues, too. This article lists common marital assets allocated in divorce settlement agreements. It also discusses how taxes affect asset value and explains how corporate redemptions are taxed. A sidebar looks at real estate and other investments that may create taxable gains when they’re sold.
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Can joint appraisers really work?
January / February 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 436
Abstract: Many courts and attorneys encourage the use of a joint valuation expert, rather than two dueling valuators. This can save time and money. It can also eliminate the perception that each side’s expert is a hired gun, advocating for his or her client’s financial interests. This article explains how a joint appraiser can speed the valuation process while avoiding potential acrimony, but also notes that joint appraisers don’t work in every situation.
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Estate of Adell – Business value excludes son’s personal goodwill
January / February 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 692
Abstract: The issue of personal goodwill is most often associated with business valuations prepared for marital dissolutions. But it can also become a key issue in estate tax valuations. This article examines one recent U.S. Tax Court decision involving a father who owned a satellite uplinking company and transferred his interest in it to a trust for the benefit of his three children. When he died and the IRS challenged the estate tax return, the Tax Court found itself addressing the issue of whether the son’s personal goodwill should be excluded from the value of the business in the gross estate. Estate of Franklin Z. Adell, T.C. Memo. 2014-155, Aug. 4, 2014
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Factoring fraud into the valuation equation
January / February 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 609
Abstract: Fraud can devastate a closely held business, and valuators do take fraud risks into account when appraising a private business interest. This article discusses the results of a biennial fraud study that looks at who is most at risk for fraud. The article also explains how fraud risks affect value.
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Think of valuation first when writing buy-sell agreements
January / February 2015
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 865
Abstract: Buy-sell agreements protect business owners from unexpected events. They can also be important when owners disagree and want to sell their interests — or buy out a difficult partner. Too often valuation issues take the backseat to legal issues, leading to irreconcilable differences when the agreement comes into play. Whether owners are deciding on a current buyout price, purchasing insurance coverage for key shareholders or planning future buyout terms, an accurate valuation is imperative. This article provides a definition of value and looks at the three valuation methods used. It also notes the importance of updating the agreement over time.
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Minority shareholder disputes – Don’t always count on stock-purchase agreements
November / December 2014
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 420
Abstract: Business owners enter into stock-purchase agreements to facilitate buyouts upon certain triggering events, such as a shareholder’s death or divorce. But a recent Minnesota Court of Appeals case shows how courts sometimes disregard these agreements, leaving minority and controlling shareholders vulnerable to court-ordered buyouts. This article points out how valuators can help ascertain whether the appraisal provisions of a stock-purchase agreement remain relevant and provide updated appraisals when needed.
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Mapping out standards of value – Business valuations can go in 4 directions
November / December 2014
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 699
Abstract: Before starting any appraisal assignment, it’s imperative to map out the appropriate “standard of value” to ensure that everyone arrives at the same point. If not, the parties are likely to end up off course or in need of backtracking. This article discusses various standards of value — fair market value, strategic value and fair value — and when each standard may apply.
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5 questions to gauge valuation expertise
November / December 2014
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 628
Abstract: Specializing in the business valuation discipline requires years of training and experience. Generalists who merely dabble in business valuations are unlikely to withstand IRS scrutiny or cross-examination by opposing counsel if the appraisal winds up in court. This article poses five preliminary questions to help differentiate specialists from generalists in the business valuation realm.
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M&A deal skyrocket: Ways to operate sale-ready
November / December 2014
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 879
Abstract: There’s been a surge of mergers and acquisitions in 2014 — and the outlook remains strong into 2015. This article discusses some recent M&A trends, hot sectors and ways for businesses to operate sale-ready to fetch top dollar in the marketplace. A sidebar suggests strategic acquisitions as a way for businesses to grow and overcome weaknesses more quickly than building in-house capabilities.
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Methodologies on trial – Keys to surviving a Daubert challenge
September / October 2014
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 433
Abstract: Valuators often serve as expert witnesses if the parties to a lawsuit can’t agree on the value of a private business interest or economic losses that have been incurred. Before valuators take the stand, they should be prepared to defend their valuation methodologies from what’s commonly referred to as a Daubert challenge (named after a landmark Supreme Court case). This article describes four factors related to the expert’s methodology that judges consider, along with the professional qualifications of the expert.
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How do private and public companies differ?
September / October 2014
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 680
Abstract: Private company appraisals are often derived from public stock data, because it’s more relevant and plentiful. But private and public companies can markedly differ in terms of risk, expected return and liquidity. Appraisals that fail to account for these differences could be making “apples-to-oranges” comparisons. This article lists some of these key differences between private and public companies.
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Recycle paper and plastic, not appraisal reports
September / October 2014
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 551
Abstract: It may seem economical and time-effective to reuse an old business appraisal for a new purpose. But recycling an appraisal without a valuator’s approval could prove costly over the long run. This article points out that there can be several definitions of value; a company’s value can change over time; and valuators face different considerations depending on why a business is being appraised.
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Questions IRS wants answered about marketability discounts
September / October 2014
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 888
Abstract: The Discount for Lack of Marketability Job Aid for IRS Valuation Professionals helps IRS field agents better understand the theory underlying this complicated discount. But the relevance of the job aid extends beyond discounts applied in a federal tax context. Anyone who relies on an appraisal that includes a discount for lack of marketability (DLOM) may benefit from reviewing this job aid, which summarizes questions valuators address when selecting a DLOM for a subject interest. This article looks at several of those questions, while a sidebar notes two of the most common DLOM approaches: restricted stock studies and pre-IPO studies.