Because the trial court found neither spouse’s expert offered a convincing valuation for a family business, it opted to adopt the liquidation value the company’s CPA proposed. On appeal, the husband contested both the trial court’s classification of the business as hybrid property as well as its valuation. Who generated increase in value? In 1981, [...]
On the weekend prior to the retrial on damages, Apple sought to increase the number of patents for which it could claim lost profits with a sketchy theory that ran counter to the damages model its own experts had constructed earlier. In an emergency motion, Samsung asked the court to preclude Apple’s alternative lost profits [...]
Goodwill in a professional partnership poses unique challenges for valuators and courts, especially in a divorce setting. In a recent Texas case dense with valuation issues, it came down to corporate goodwill. “Logic tells me there is some,” the trial court said, “but it’s probably impossible to quantify.” The finding triggered an appeal. Case Summary: [...]
1. Keeping in mind the big picture. In business valuation, it’s important to keep the big picture in mind and not get lost in complexities. Additional information will be continually introduced throughout the process, and updating figures repeatedly can be costly and time consuming. 2. Close collaboration among the attorney, expert, and the client is [...]
Very often during the valuation process you’ll come across a shareholder loan recorded on the books of the subject business. Your first impulse will be to determine its fair market value, but wait a minute. The question must be asked: “Is this a bona fide loan or is it really equity?” The trouble is, there [...]
In re Civic Partners Sioux City, LLC, 2013 Bankr. LEXIS 4225 (Oct. 7, 2013) After declaring Chapter 11 bankruptcy, the debtor, a developer, asked the Bankruptcy Court to confirm the latest version of its reorganization plan in a “cram down” proceeding. Two key creditors objected, arguing that the plan rested on an improperly low valuation [...]
If you are a foreign national looking to make an entry to the US market, an E-2 Investors Visa could be right for you. If your home country has a treaty with the US, (list found here), the E-2 Visa allows you to invest capital ($50,000+) and establish a business in the US. The E-2 Visa [...]
In the upcoming fifth edition of their essential book, Cost of Capital: Applications and Examples, Shannon Pratt, FASA (Shannon Pratt Valuations), and Roger Grabowski, FASA (Duff & Phelps), reveal new analysis that examines the existence of the size premium. Background. A company’s size is one of the most important elements of risk to consider when [...]
Do I need a forensic accountant? This is a question we get asked on a regular basis. While there is no definitive answer, here are some markers that might indicate the need of a forensic accountant. Is there a business involved? Retirement accounts? Suspected hidden income? Community property? Fraud? If any of those bullet points [...]
A recent listing of accounting expert witnesses mentioned in court opinions or decisions in 2013 reveals that 88% were CPAs. The listing, which is “not exhaustive and only for informational purposes,” includes 189 forensic accounting expert witnesses with multiple credentials. As for the prevalence of other credentials, 31% were certified in Financial Forensics, 29% had [...]
