Federal Agency Identifies Valuation Risk Factors and Best Practices Could the Securities Exchange Commission’s informal inquiry regarding valuation be an opening salvo to allow more formal investigation, or even regulatory action? The McLean Group shares an in-depth analysis of the SEC’s findings. ...

What Can be Won by Avoiding Litigation? By using the litigation-derived adversarial process as a template to educate and a resource for better decision-making, writes Paul Leiman, owners may well find that litigation itself can be avoided. Find out how. ...

A Balance of Valuation and Litigation Work; Secrets to Enhanced Productivity Marcie Bour, Founder and President of the Florida Business Valuation Group, offers tips and strategies on time management, favorite appraisal tools, marketing strategies, the benefits of client diversification, and the value of networking and seeking out mentors. ...

How to Maintain Independence and Professionalism in a Complex and Changing Niche As divorce laws change, attorneys increasingly rely on financial experts such as business appraisers and forensic accountants.  In this article, Robert D. Feder discusses the role of a financial analyst in the context of matrimonial law.  He also covers some of the potential pitfalls of the trade. ...

Valuators Must be More Than “Lucky Punks” How can appraisers best figure the cost of equity capital? Rand M. Curtiss argues that using standard tools including Ibbottson, Duff & Phelps, CAPM, or the Butler-Pinkerton model aren’t enough. What to use instead? Curtiss suggests starting with a look at the rate of return on mezzanine money and the rate of return on later-stage VC investments. Find out why. ...

Forensic Accounting Revenue in the U.S. is Expected to Grow 6.8% Annually A recent market research report noted in The CPA Insider reports that demand for forensic accounting services will remain strong over the next five years in the United States as a result of increased financial regulations and continued demand for investigative services in the wake of the recession: ...

"It Got a Bit Ugly" Sarah E. Needleman at the WSJ Small Business Blog reports:  Ten months after co-founding a communications firm in 2008, Tami Hausman asked her business partner to meet at a local Starbucks. Things weren't working out, Ms. Hausman says, and she wanted to run the New York company on her own. ...

A Credit Card Debt is Settled, But Tax on DOI Income Still Due Judge Ruwe at the Tax Court finds petitioners owe tax on income from a settled credit card debt in Shepherd v. Commissioner, and a U.S. Bankruptcy Court for the Western District of Pennsylvania rules on the valuation of a mortgagee’s creditor’s secured claim in Buena Vista Oceanside, LLC., v. Optimum Bank ...

Avoiding the “Why Me’s”: Easy-to-Implement Steps to Mitigate Fraud Risk Financial fraud can be devastating and fiscal, legal, and developmental repercussions can impede the operations of a business for years after an incident. Paul E. Zikmund takes us through his four-step process to actively deter fraud within an organization. ...

Understand the Critical Distinction Between a “Testifying Expert” and a “Consulting Expert.” Brad Eldridge and Rebekah Smith explain how the requirements for a “testifying expert” in litigation work vary considerably from those for a “consulting expert.” Learn more about this distinction and find out how consultants can develop a checklist of best practices for courtroom preparation. ...

Critically Assess Underlying Data and an Appropriate Method for Value Determination Richard Claywell regularly reviews business valuations that seem to consider the asset, market, and income approaches in forming an opinion, but that never explain or justify a weighting methodology used to arrive at a final value conclusion. Here’s why that’s a mistake.   ...

Appeals Courts in Iowa and Mississippi Settle Divorce Disputes The Mississippi Court of Appeals reverses a trial court’s ruling in Marter v. Marter because of a valuation without sufficient evidence, and the Iowa Court of Appeals affirms the value of a wife’s intangible contributions to a business in re Marriage of Kinser.  ...

Enumerate Specific Assets, and a Specific Methodology for Those Assets If a fair market value is determined by multiple appraisers, it’s likely to be too high—and lead to a rush for the door, where the first doctor out wins. Here’s why. ...

Owners Can Improve Cash Flow, Reduce Risk, and Generate Growth Successful exit plans require building long-term value, and Ron Stacey explains how business owners can begin to do that today by improving cash flow, reducing risk, and accelerating growth. ...

Should Losses Trigger an Immediate Charge or Later Write Down? The Financial Accounting Standards Board (FASB) is engaged in an interesting discussion with the International Accounting Standards Board (IASB) regarding how quickly bad loans need to be recognized by banks. Here’s the essence of the dispute. ...

Fairness Opinions Help Mitigate Conflicts of Interest, Establish Transaction Credibility, and Avoid Unfavorable Tax Issues Brian A. Sullivan and Andrew C. Smith discuss how you can leverage fairness opinions to mitigate conflict of interest, avoid unfavorable tax issues, and help secure acceptance of transactional decisions by minority shareholders. ...

The Future Will Probably Include Not Only More ESOPs, But More High-Percentage (70-100%) ESOPs. Here’s Why What will happen with Employee Stock Ownership Plans and Trusts over the next few decades? Many authorities estimate that as many as one out of every two businesses will change hands over that time period as baby boomers enter retirement age and look to transition their long held businesses. Where does ...

There are Lots of Exit Options Owners Can Plan for, but Putting Together a Plan is Essential Business owners need to plan the sort of exit they hope for early on and treat exit options explicitly as part of their initial business plan. Whether owners are looking to sell outright, be acquired by another company, go public, choose simply to liquidate, or let the business run dry matters. Here’s why. ...

Tax Treatment for Rebates Differs Depending on How Insurance Premiums Were First Paid The last wave of MLR rebates have either reached their recipients or are in the mail. Reed Tinsley explains how healthcare practice managers can determine the appropriate way to treat those rebates when tax time comes. ...

Choosing Board Members for a Family Business Can be a Delicate Process, but with Proper Due Diligence, a Perfect Fit Can be Achieved. Mario Vicari and Tyler Ridgeway cover some of the key points in choosing board members for a family business, covering topics from how a board should be structured, how board members should be qualified and compensated, and what work should be expected from them. ...