Develop the Tools to Stay Afloat in a Sea of Distressed Valuations
As news of the economic recovery of 2009-2010 trickles in valuation experts are preparing for an unprecedented wave of impaired and distressed business valuations – fallout from the deep recession that has impacted the entirety of the economic landscape. Expert appraiser Jim Alerding agrees: “I’ve been in this business since 1980 and we’ve never really [...]
New study shows business litigation about to swell
Another source forecasts the much-predicted spike in securities and corporate litigation around business valuation. The latest results from Fulbright & Jaworski LLP’s sixth annual Litigation Trends Survey have arrived—and 42% of corporate counsel polled say they expect litigation to swell in the coming year. This represents a significant leap over last year’s survey, when only [...]
Another big taxpayer victory: Federal court accepts appraiser’s 35% combined discounts for 94% family LP interest
The Murphy Oil Corp. grew from a small, family owned business into a multinational conglomerate, with over $2 billion in market cap. During the 1990s, the CEO and son of the founder set out to preserve his holdings and his investment philosophy for the benefit of his children. He formed a family limited partnership (FLP [...]
IRS internal memo: any agent can now assess penalties against you under 6695A
In a troubling glimpse into its procedures, the Internal Revenue Service issued an internal memorandum to examiners, estate and gift attorneys, and appellate officers regarding “Procedures for Implementing the Penalty for the Substantial and Gross Valuation Misstatements Attributable to Incorrect Appraisals Under IRC Section 6695A.” The memo—written in August 2009—only recently came to light after [...]
Damodaran at ASA: rethink business valuation fundamentals
In mid-September 2008, Professor Aswath Damodaran (NYU Stern School of Business) believed “I could think through any valuation problem.” By the end of October, he told last week’s ASA Advanced Business Valuation Conference, during his two-hour keynote address, “I didn’t know the first thing about valuation…the current economy reminds us why we have an equity [...]
Butler/Pinkerton Calculator adds Canadian market data
We just flipped the switch on the Butler Pinkerton Calculator™ (BPC) so that it now accepts Canadian stock tickers and includes the Toronto Stock Exchange (TSE) as a market proxy (S&P;/TSX Composite). This adds another tool for Canadian and cross-border appraisal work when determining the total cost of equity (TCOE) and company-specific risk for valuation [...]
You could already be an expert witness and not know it…
You could already be expert witness, and not know it Until the economy fully recovers, litigation consulting is looking like a solid growth opportunity these days. In a prime example of how two leading BV experts continue to mine their referral lists, Chris Mercer (Mercer Capital, Memphis) and David Adams (Adams Capital, Atlanta) spoke to [...]
How Deloitte tried to build its wealth management practice
Deloitte has just published its annual wealth planning guide: The Essential Tax and Wealth Planning Guide for 2010 – A Year-round Resource. It’s a great marketing example for any BV firm interesting in expanding into exit planning or wealth management consultancy. The 22nd version of the guide discusses: · The current tax environment: What has [...]
A key step to improve your discounted cash flow analyses
Darrell Dorrell (Financial Forensics, Lake Oswego, OR) reminds appraisers that “if you do a DCF projection, you need to extend not only the income statement, but also the balance sheet and cashflow statements.” He says “it’s pretty easy to attack an opponent in court who has only extended the income statement. Easy errors will pop [...]
Will be we be more dependent on guideline public company method?
Any one who has been following Rob Slee’s (Robertson & Foley) research on private capital markets knows that he’s a strong advocate for the guideline public company method—even for small private companies. “It’s the one place where you can get longitudinal data that incorporates risk and growth factors,” he’s been saying. “Particularly if you’re trying [...]
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