Study: Merit Pay is Ineffective for Many Employers According to a new survey of North American employers, only 20% find merit pay to be effective at driving higher levels of employee performance.  Matthew Heller, for CFO, explains that “pay-for-performance” may not always work in an employers’ favor. To read the full article in CFO, click: Merit Pay Programs Falling Short of Goals. ...

IRS Proposes Rules for Closed Pension Plans The Internal Revenue Service has responded to the proliferation of closed defined benefit pension plans, which continue to cover older employees while prohibiting new employees from joining, by proposing regulations that would let the plans qualify under the nondiscrimination rules.  Sally P. Schreiber senior editor for The Tax Adviser, explains. To read the full ...

IRS Final Regulations are Intended to Curb Inversions The new exception from the inversion rules for companies that have substantial business activities in a foreign country is hard to satisfy.  Jesse Scott, J.D., LL.M., associate at Holthouse, Carlin & Van Trigt LLP, discusses how corporate inversions have recently returned to the forefront of American political speech. To read the full article in The ...

Fairness opinions are issued by a financial advisor at the request of a board that is contemplating a significant corporate event.  Jeff K. Davis, CFA, managing director of Mercer Capital’s Financial Institutions Group, delivered a presentation on November 30, 2015 at the IV OIV International Business Valuation Conference in Milan, Italy by addresses the topic of dual fairness opinions and the role of the v ...

Expanding the Lessors Qualitative and Quantitative Disclosures In February 2016, the FASB issued Accounting Standards Update (ASU) 2016 – 02, Leases (Topic 842). The existing standard has been criticized because its bright line classification criteria enabled entities to structure leases in such a way as to avoid putting them on the balance sheet. The standard aims to improve and simplify the financial repo ...

Settlement of a Valuation Case Before the U.S. Tax Court This article discusses issues found in a case that is pending before the United States Tax Court (the “Tax Court”).  The specific issues relate to issues regarding sales of closely held stock to grantor trusts in exchange for promissory notes.  Specifically, the IRS took issue with two grantor sale trust transactions.  The two cases were filed on Dece ...

5 Steps for Inspiring Passion in Your Employees Passion is the most important trait a company can have, but no class can teach leaders how to spark and sustain that quality in others, writes Red Hat CEO Jim Whitehurst.  What's needed are five conditions, including smart hiring practices, autonomy, and mission-driven leadership. To read the full article in the Harvard Business Review, click: How to Build a P ...

Twenty large U.S. companies have formed an alliance in an effort to rebalance relationships between corporate America and the health supply chain.  Andrew Kenney, contributing editor for CGMA, explains. To read the full article in CGMA Magazine, click: U.S. Companies Align to Control Health Care Costs. ...

Non-compete agreements are increasingly in the news, though not always in the most favorable of contexts.  Proponents argue that such agreements protect firms’ intellectual property and prevent the loss of key employees, customers, suppliers, and trade secrets.  Karolina Calhoun, senior financial analyst with Mercer Capital, explains that others would suggest that non-competes stifle innovation by limiting ...

Notable 4th Quarter 2015 Cases, Part II of II Part II of this article highlights the remaining notable 4th Quarter 2015 U.S. Tax Court Cases that will be of interest to valuation practitioners and business advisors.  Estate of Purdue reminded us that taxpayers need to address 2036(a) concerns and establish a non-tax reason.  In addition, the case reminds us that gifting an equity or LLC interest may not qua ...

Effective Interview Planning in a Fraud Investigation This article is a republication of Chapter 10 of The Corporate Fraud: The Executive’s Survival Guide, authored by Ray Dunkle of Red Flag Reporting. This article features the chapter written by James I. Marasco, CPA, CIA, CFE. In this chapter, Mr. Marasco addresses the proper approach for conducting interviews. This includes what type of questions to ask, ...

Why it Takes so Long to Hire Good CFOs CFO positions are taking longer to fill as companies and job candidates get more selective.  Many companies are now looking for people who have international experience and know how to work with activist shareholders.  However, John Touey, principal at executive search firm Salveson Stetson Group, discusses that highly qualified CFOs may be less eager to take risks and ...

Companies Struggle to Make Good Decisions With Their Data Many large businesses worldwide are struggling to gain strategic insight from the massive amount of data they gather, according to research from CGMA.  Thirty-six percent of respondents say their organizations haven't been able to manage this deluge of data.  Samantha White, senior editor for CGMA Magazine, explores the fact that many companies are u ...

Consumer Spending Returns to Growth in U.S. Core U.S. retail sales grew 0.6% in January, reversing a 0.3% decline in December, the Commerce Department said.  Also, a University of Michigan survey found that consumers are generally optimistic and say their purchasing power will benefit from low inflation.  Harriet Torry, The Wall Street Journal, explains. To read the full article in The Wall Street Journal, ...

As mutual fund flows continue to favor passive strategies, some active fund managers are beginning to look to alternative asset classes to augment returns and generate sustainable alpha.  Travis W. Harms Mercer Capital’s Financial Reporting Valuation Group lead, discusses how the inclusion of illiquid venture capital investments in liquid funds shines a brighter spotlight on fair value measurement. To read ...

Notable 4th Quarter 2015 Cases, Part I of II Part I of this article highlights notable 4th Quarter 2015 U.S. Tax Court Cases that will be of interest to valuation practitioners and business advisors. Estate of Purdue reminds us that taxpayers need to address 2036(a) concerns and establish a non-tax reason. In addition, the case reminds us that gifting an equity or LLC interest may not qualify as a present i ...

About Valuing Pass-Through Entities ...

Clues to Finding a Missing Will Wills sometimes go missing.  Places to check include probate court, safe deposit boxes and hiding places around the home.  Also, consider contacting relatives and reviewing bank statements.  The Kansas & Missouri Estate Planning Blog reminds you that good communication can help prevent this type of problem altogether. To read the full article in WealthManagement.com, clic ...

Estate Planning When the Federal Estate Tax Doesn't Apply Even when your clients have estates that will not be subject to the federal estate tax when they die, helping them plan for the future can be complicated.  Steven G. Siegel, JD, LLM, Siegel Group, suggests ways you can help them best manage their assets To read the full article in AICPA Insights, click: Estate Planning for the 99 Percent. ...

How to Determine Household Workers' Tax Status The so-called "nanny tax," which actually applies to any form of household employment, can be complicated for clients to deal with.  A client is treated as an employer if he or she pays more than $2,000 to a household worker per year.  Whether that worker is an employee or an independent contractor depends on the nature of the business arrangement.  Karen DeMas ...