Viewpoint on Value
Showing 369–382 of 382 results
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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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Give your appraisal a dose of reality
July / August 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 500
Abstract: Before valuators finalize their conclusions, they step back and ask, “Would this number make sense in the real world?” Experts typically rely on their professional experience to answer this question. But they may also turn to various sanity checks. This brief article lists some sanity checks valuators may turn to, including industry rules of thumb, the justification of purchase (JOP) test and other sources of supplemental data.
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Buy-sell agreements in divorce — Having good advice is key
July / August 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 671
Abstract: Dissolving a marital estate that includes a private business interest can be fraught with complications. One of the first steps is to disclose and reconcile all relevant valuation evidence, including buy-sell agreements. The buy-sell provisions of partnership or shareholder agreements are intended to protect ownership interests. But they may come back to haunt owners or their spouses later in divorce. This article discusses a recent case that illustrates the importance of both spouses having expert valuation advice to help navigate the ins and outs of these agreements in a marital dissolution case.
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What you see may not be what you get — Making complex valuation adjustments
July / August 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 877
Abstract: The process of valuation often requires adjustments to ensure the final numbers make sense for a particular company. Adjustments can affect how a valuator applies the cost, market and income approaches. So, it’s imperative to consider their impacts throughout the valuation process. This article explains the different categories of adjustments, using examples to illustrate their effects on value. It notes that, because discrepancies between two expert opinions can occur, expertise is key in applying the appropriate valuation adjustments.
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Valuators in the field
May / June 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 397
Abstract: Site visits are an important part of the valuation process. Not only do they enhance a valuator’s understanding of business operations, but they also provide an opportunity to conduct face-to-face management interviews. This brief article lists what valuators look for during site visits, including asset and facility condition and whether there are any capacity issues.
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Appraising appraisals — How to read a valuation report
May / June 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 551
Abstract: To understand an appraisal opinion, readers must wade through unfamiliar financial jargon, subjective assumptions and pages of complex mathematical computations. And comparing two widely divergent analyses to ascertain which opinion is more reliable is even more challenging. This article highlights some key elements that should appear in a comprehensive, reliable valuation report.
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Taxpayer victory in the battle over built-in capital gains tax
May / June 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 1072
Abstract: Built-in capital gains tax is an economic reality for C corporations. Recent Tax Court rulings have forced the IRS to concede that hypothetical investors consider imbedded tax liabilities when buying and selling C corporations. This article discusses a recent case, Estate of Jelke v. Commissioner, which provides an example of the ongoing debate as to whether valuators should apply dollar-for-dollar or discounted reductions for built-in capital gains tax liabilities. Citations: Estate of Jelke v. Commissioner, U.S. Court of Appeals for the 11th Circuit, No. 05-15549, Nov. 15, 2007. Estate of Davis v. Commissioner, 110 T.C. 530, 1998. Estate of Eisenberg v. Commissioner, 155 F.3d. 50, 57, 2d. Cir., 1998. Estate of Jameson v. Commissioner, 267 F.3d. 50, 57, 2d Cir., 1998. Estate of Dunn, 301 F.3d. 339, 5th Cir., 2002.
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The nuts and bolts of valuing manufacturers
March / April 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 415
Abstract: A reliable manufacturing valuation hinges on an in-depth understanding of current industry trends and value drivers. This brief article describes the most useful approaches for estimating a manufacturing firm’s fair market value and notes some important trends and risks that affect domestic manufacturer value.
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Which income projections, when?
March / April 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 676
Abstract: Future earnings often serve as the basis of value. But a company’s earnings capacity is in the eye of the beholder. This article explains that valuators can look at several factors when deciding the basis for estimating future earnings, including historic data, management projections and appraiser analyses. It discusses a recent divorce case, Aukeman v. Aukeman, to illustrate this process.
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No more cookie-cutter FLP valuations
January / February 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 475
Abstract: Attention to detail and thorough documentation are key ingredients to preserving family limited partnership (FLP) valuation discounts. This brief article notes some of the ways valuators support these discounts and uses a case study to illustrate the need to consider state tax regulations and provide well-founded written documentation in supporting FLP valuation discounts. Citations: Estate of Helen H. Berry, No. 1485 C.D., LEXIS 182, April 24, 2007. Estate of Thompson, 382 F. 3d 367, 379, 3rd Cir. 2004.
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Buy-sell agreements gone bad — Plan for the unexpected with a comprehensive plan
January / February 2008
Newsletter: Viewpoint on Value
Price: $225.00, Subscriber Price: $157.50
Word count: 636
Abstract: Buy-sell agreements are legal contracts that spell out buyout terms and provisions during key ownership changes. But inadequate agreements can create problems when owners can least afford the turmoil. This article explains some of the common valuation-related mistakes owners make when setting up buy-sell agreements, including failing to define buyout terms, using ambiguous or outdated valuation formulas, and misstating or failing to verify financial data. The article emphasizes the importance of consulting with an experienced valuation professional to ensure the agreement covers all the bases.