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Standards Though the Eyes of a Practitioner

Reconciling compliance with multi-agency valuation standards While standards exist to uphold the integrity of business valuation, multi-credentialed professionals can face a daunting task when trying to compare and comply with all guidelines across the spectrum of issuing agencies. This article seeks to root out possible conflicts and create clarity among standards so valuators may perform with less effort ...

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Food for Thought: Restaurant Valuation

  According to a recent article in The Appraisal Journal, industry sales among the 616,098 restaurants in the U.S. totaled $425.6 billion in 2012. Chain restaurants make up nearly 45% of the industry population in the U.S., and at a growth rate of 2.2% are expected to overtake independent establishments by 2023. Between 2010 and 2012, 22,000 restaurants were sold for a total of almost $11 billion. The ...

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Necessary Adjustments

Deviations for biased cash flows Cash flows vary, and traditional approaches need to take into consideration the downside or cessation probability; otherwise, the value of the entity is overstated. Setting the probabilities of "downside" and "cessation" risk drives the appraiser's efforts in adjusting for biased cash flows. This article presents an approach that can be used to adjust the cash flow. ...

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Fitch Doubts IFRS Standards Implementation in U.S.

A Fitch Ratings report has shared serious doubts that the practice principles of the International Financial Reporting Standards (IFRS) would be fully implemented in the U.S. anytime in the near future, as the Financial Accounting Standards Board (FASB) turns colder on the idea. Three sticking points to the merger of the methods remain financial instruments, insurance and leasing. Financial products with U. ...

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Mercer’s Five Big Valuation Issues

  In case you missed it, Z. Christopher Mercer, ASA, CFA, ABAR, founder and CEO of Mercer Capital, was the keynote speaker at the American Academy of Matrimonial Lawyers (AAML) and the American Institute of CPAs (AICPA) 2014 bi-annual joint conference this year. His presentation concerned The Five Really Big Valuation Issues. They included: 1.) discount rates, 2.) control premiums and minority interest ...

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Valuing Equity in Real Estate-Holding Entities

Think like an investor, not an accountant! If fair market value is to determine investor expectations and equity risk; then why do these factors receive limited or no consideration when opining on the level of impairments (investor concessions) ubiquitously referred to ask discounts? This article addresses the business risks associated with asset-holding companies' equity that should be considered and repor ...

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Healthcare Reimbursement Models to Change, Affecting Valuation

  Reimbursements from insurers, made to healthcare facilities for the care they administer, are an essential part of the valuation of hospitals, clinics, outpatient care centers and other facilities. As if that exchange wasn’t complicated enough, it’s about to go through another transition that very well may impact the valuation of all healthcare institutions. According to a new white paper released by ...

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Can a CEO Divorce Affect Corporate Valuation?

  Do shareholders and boards have a reason to be concerned when a CEO separates or gets divorced? This is the question being asked in a fascinating white paper titled, Separation Anxiety: The impact of divorce on shareholders by David F. Larcker, Allan L. McCall and Brian Tayar of Stanford University Graduate Business School. The paper is part of the Rock Center for Corporate Governance at Stanford Uni ...

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AICPA Protests IRS Regulation for Tax Preparers

  The American Institute of CPAs (AICPA) recently sent a letter to the IRS calling a proposed “voluntary” certification program for unenrolled tax return preparers “unlawful and improper”. In a recent ruling, Loving, No. 13-5061 (D.C. Cir. 2/11/14), it was held that the IRS does not have the statutory authority to regulate tax return preparers. In the aftermath, IRS Commissioner, John Koskinen, stated ...

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Intellectual Property Valuation Principles—Part 2

Breaking down invisible value Read Part 1 here. This overview is the second half of Robert Reilly’s series that examines the types of intellectual property analyses, different standards of value that may apply in valuation as well as the alternative types of intellectual property ownership interests and the alternative terms of intellectual property ownership interests. Finally, it offers a discussion regar ...

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Invisible Value

Intellectual Property Valuation Principles—Part 1 This article examines the types of intellectual property analyses, different standards of value that may apply in valuation as well as the alternative types of intellectual property ownership interests and the alternative terms of intellectual property ownership interests. ...

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One Quarter of All Public M&A Deals Involve Insider Trading

  As if the general public hadn’t lost enough faith in the stock market with recent revelations of rigged deal-making that benefits only a few, a new study shows that 25 percent of all M&A deals between public companies involve some kind of insider trading. The study, conducted by McGill University and New York University, looked at informed trading activity in equity options prior to the announcem ...

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