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National Association of Certified Valuators and Analysts

The National Association of Certified Valuators and Analysts (NACVA) supports the users of business and intangible asset valuation services and financial forensic services, including damages determinations of all kinds and fraud detection and prevention, by training and certifying financial professionals in these disciplines.

Number of Entries : 2567

Understanding IPCPL Theory, Evidence, and Application

Use in Private-Business Valuation (Part IV) In this fourth article, the authors show how to apply the IPCPL theory using public market cost of capital. Read Part I, Part II, and Part III Application of IPCPL Theory When Bob Dohmeyer, Pete Butler, and Rod Burkert published their article on the IPCPL in 2013, they developed a discount rate from the Deal Stats database. In 2015, we published an article in whic ...

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Legal Update: June 2024

Lytle v. Nutramax Laboratories, Inc. et al.—Challenging a Proposed Class Action In Lytle v. Nutramax Laboratories, Inc., et al., 2024 U.S. App. LEXIS 9722; __ F.4th __; 2024 WL 1710663 (9th Cir. April 22, 2024), the court affirmed certification of a class of dog food purchasers alleging the defendants made fraudulent claims about the health benefits of the supplements they manufactured. Andy Rooney famously ...

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Discount Rates for Lost Profits

A Question of Facts and Varying Rates “How could an expert apply such a high or low discount rate to a stream of future lost profits and the court find it acceptable?” This article highlights my research looking into discount rates for lost profits and why there are so many variations of a theme when it comes to making such a calculation. When attending professional conferences, I enjoy talking with other e ...

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Core Elements in Quantifying Lost Profits

Reminders from an Experienced Expert that Go Beyond a Checklist Calculating lost profits is a crucial aspect of many legal and financial matters, particularly in the realm of business disputes, insurance claims, and litigation. Lost profits represent the financial harm suffered by a plaintiff due to a specific incident or event. In a business context, lost profits aim to restore the injured party to the fin ...

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Understanding IPCPL Theory, Evidence, and Application

Empirical Evidence Supporting IPCPL Theory (Part III) In this third article, the authors present the empirical evidence supporting use of the IPCPL theory. In the second article in this series, it was shown that the general empirical implications of implied private company pricing line (IPCPL) theory are that buyers of privately owned businesses pay higher transaction costs in exchange for higher returns on ...

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Fidelity Claims Investigations

A Comprehensive Guide to Successful Claims Outcomes (Part II of II) In this second of a two-part article, the authors discuss areas where outside expertise may be needed and policy exclusions. Read Part I here. Introduction: Navigating Claims Challenges and How Experts Can Help Throughout the fidelity claims handling process, issues or challenges may arise for which parties involved must reconcile. Here are ...

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Unimpeachable Principalities

A Principle-Driven Framework to Standard Setting This 17th article of the unimpeachable neutrality series will attempt to elevate your understanding of standards beyond mere compliance and foster a world rich in principle-driven actions. In a world increasingly governed by complex standards and regulatory landscapes, the craft of creating standards that stand the test of time has never been more crucial. Ju ...

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Fidelity Claims Investigations

A Comprehensive Guide to Successful Claims Outcomes (Part I of II) Fidelity/crime/financial institution bonds, in a general sense, cover an insured from the willful theft of property, money, and securities by one of their employees or an outside third-party carried out through a variety of means. Such fraud can impact myriad industries. In this two-part article, the authors provide fundamental aspects of a ...

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Reducing Bias in Business Valuation Engagements

Navigating Bias in Business Valuations Valuation analysts are tasked with gathering information, analyzing data, summarizing findings, and communicating the results. This includes quantifying the expected cash flows and risks of the business through often conflicting and misrepresented information. This article provides an overview of bias, how it affects business valuations, and provides readers with the s ...

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The #1 Thing Prospects Look for on Your Website

What is the #1 thing on your website that will convince a prospect that your firm is the right choice for a project? Rod Burkert shares his views on what is needed to go from zero to hero and land that engagement. Imagine I am a prospect for getting your BVFLS services. I found you on Google or LinkedIn. Or maybe I saw an article you wrote. Maybe heard a presentation you gave. Or maybe I got a recommendatio ...

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Challenges to Expert Witnesses Under New Rule of Evidence 702

Experts on Notice Federal Rule of Evidence 702 has undergone changes; these were made in 2000 and 2011. The recent amendments clarify the gatekeeping function of the trial court. A trial court is charged not with weighing the expert’s opinion; rather it is charged with determining if the testimony is admissible. This article discusses the recent changes to this rule and how this will impact proposed experts ...

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The Meritocracy of an Unregulated Market

Is There a Need to Broaden Regulation? Can humans achieve economic market efficiency without the “visible hand” or is the collateral damage of decisions an unfortunate reality in exchange for the freedom of unregulated markets. This article discusses the role of regulation in an unregulated market and potential shifts. How do you measure ability when the parameters are not clearly defined? As valuation anal ...

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DOJ Announces Record-Breaking Fraud and Abuse Settlement

Valuation-Shopping Investigated On December 19, 2023, the U.S. Department of Justice (DOJ) announced that it had entered into a $345 million settlement with Community Health Network Inc. (CHN), a healthcare network headquartered in Indianapolis, to resolve claims that the hospital violated the False Claims Act (FCA) by knowingly submitting Medicare claims for services which were referred in violation of the ...

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Understanding Net Working Capital

A Key Formula Used in Business Valuation Net working capital is a crucial component of business valuation since it impacts both a company’s enterprise value via its projected cash flows and its equity value via excess or deficient net working capital levels as of the valuation date. In addition, net working capital for valuation purposes is more nuanced than simply taking current assets minus current liabil ...

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Congress Increases 2024 Medicare Physician Pay

Patchwork Approach Continues in Congress On March 9, 2024, President Biden signed into law a $460 billion spending package to continue funding the federal government for the remainder of the 2024 fiscal year. Contained within the spending package was legislation to cut in half the 2024 Medicare physician payment update of approximately -3.4%. This article discusses the payment update, other healthcare provi ...

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Legal Update: June 2024

Watts v. Smith–Long-Term Means Long-Term In the business valuation world, valuators attempt to consider a benefit stream into perpetuity, which is a very long time. Sadly, many business owners have difficulty grasping long time periods as they execute agreements dealing with multi-generational ownership and family relationships. In Watts v. Smith, 2023 Ky. App. (Unpub.) (Ky. Ct. App. September 8, 2023), the ...

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The Panduit Test

Guidance Provided by Godinger Silver Art Ltd. The Panduit test is a widely used four factor test that is applied primarily in patent cases but also intellectual property cases. The test factors can be found in Panduit Corp v Stahlin Bros. Fibre Works, Inc. This article will focus primarily on the 2024 Godinger Silver Art Ltd. decision. The language of that decision has been used to explain the court’s under ...

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What Makes Effective Marketing Effective?

Marketing is difficult. Yet, there are ways one can make more effective inroads. In this article, the author makes four suggestions to make your marketing efforts more effective. If the ultimate goal of your marketing effort is to increase the number of leads/prospects in your pipeline, the article includes some metrics one can measure to assess success. Do you know what is working and what is not with your ...

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Evolving from Valuation to Value Creation

A Call to Opportunity (and Survival) As the use of artificial intelligence (AI) tools continues to become mainstream, it is no wonder that so many professional services are becoming even more commoditized than they were pre-AI. Many professional service providers, including valuation practitioners, are feeling the combined impact of price compression from clients and higher expectations of service quality a ...

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How Bad Data Hurts Your Valuation

The Principles of Conservatism in Action Most business owners understand the industry in which they operate and tend to be good at running the day-to-day operations. Yet, that does not mean they have made optimal decisions or that they have the necessary controls and financials in place that enable them to make sound financial decisions. Companies that do not keep high quality data will likely have a lower ...

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