Asset Values (Part I of III) This is a three-part article that focuses on valuing nonprofit corporation assets. Valuation analysts are commonly engaged to provide fair market value guidance related to nonprofit business transactions. Nonprofit businesses are often involved in arms-length transactions. Common transactions include royalty payments for the use of intellectual property, royalty revenue earned by licensing intellectual property, sales of assets, and purchases of assets. If the subject transaction is between a nonprofit and a related party, the transaction is required to be a fair market value transaction. This series provides an example of certain steps and procedures…
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For 2020 and Beyond Merriam-Webster dictionary defines blockchain as a digital database containing information (such as records of financial transactions) that can be simultaneously used and shared within a large decentralized, publicly accessible network. In this article, the author predicts blockchain trends and its impacts of the accounting profession. With a new year comes changes across multiple facets of the accounting vertical, and there has arguably been no trend and tool that has dominated the accounting conversation more than blockchain technology and its applications. Since its launch from obscurity to the mainstream business and accounting conversation, blockchain and its applications—including…
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Without An Elephant One question: Would you like to learn a technique that might make the problem-solving process work more efficiently and perhaps, just perhaps, produce better results? In this article, Nancy Yeend presents the W-I-N method. Of course, you know how to solve problems—that is what you do for a living. One question: Would you like to learn a technique that might make the problem-solving process work more efficiently and perhaps, just perhaps, produce better results? Define the ProblemThe John Godfrey Saxe’s poem, The Blind Men and the Elephant, is an example of how people can view the same…
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In the Formation of an ESOP Mr. Robert Reilly, in a two-part January 2020 QuickRead article, as published by NACVA, provides a detailed and learned discussion regarding the role a valuation analyst might play in the early stages of the formation of an Employee Stock Ownership Plan (ESOP). This paper is not intended to be, in any way, a critique of Mr. Reilly’s presentation, but rather an appendix highlighting some of the many risks a valuation analyst will face when accepting an ESOP related engagement. Mr. Robert Reilly, in a two-part January 2020 QuickRead article, as published by NACVA, provides…
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Robert Reilly Shares His Thoughts on Impressions Should a valuation analyst accept an ESOP valuation engagement? That is the question raised by Michael McKean in his article written in response to the recent QuickRead article series by Robert Reilly. In this article, Mr. Reilly shares his thoughts on the subject matter. I am old enough to remember the early television show, The Original Amateur Hour. I started watching the show in the 1950s, although it debuted on television in 1948 (before my time). I remember the spinning wheel and the phrase, “Round and round she goes, and where she stops…
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In an ESOP Formation Financial Feasibility Analysis (Part II of II) This is the second of two-part article that discusses ESOPs. In this part, the author focuses on quality of earnings, liquidity, and plan design analyses. Owners of a private company who are looking for an exit strategy may consider the sale of all (or part) of the company to an employee stock ownership plan (ESOP). Such a strategy may be particularly attractive to baby boomer private company owners who are seeking retirement and liquidity and who would prefer to see their loyal employees retain a stake in the company…
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About Your BVFLS Practice? There are three ways to deliver professional services. The benefits and detriments of each are discussed in this article. The author also shares his opinion regarding what model(s) BVFLS practitioners should adopt. We’re supposed to be smart, sophisticated, experienced business appraisers who deliver insights that assess value. Why, then, do most of us operate with a one-dimensional business model? You know, the thing that generates our cash flow and having a high “practice specific risk premium.” What would an experienced appraiser say about our BVFLS practices? There are three ways to deliver professional services like ours.…
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In an ESOP Formation Financial Feasibility Analysis (Part I of II) This two-part article discusses ESOPs. Owners of a private company who are looking for an exit strategy may consider the sale of all (or part) of the company to an employee stock ownership plan (ESOP). Such a strategy may be particularly attractive to baby boomer private company owners who are seeking retirement and liquidity and who would prefer to see their loyal employees retain a stake in the company ownership. This article considers the role of the valuation analyst in performing an ESOP financial feasibility analysis. Such an analysis…
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Revising Your Firm’s Brand As a new decade begins, you may consider the state of your firm’s overall brand and if there are any needed changes. When you conduct such an exercise, one of the first elements to consider revising is your firm’s positioning statement. In this article, we will review the five steps to writing an effective positioning statement which can be a strong foundation for your brand. As a new decade begins, you may consider the state of your firm’s overall brand and if there are any needed changes. When you conduct such an exercise, one of the…