The Method You Choose Depends On the Data You Have Application of discounts and premiums is one area where valuators demonstrate added value. Paul R. Hyde shows how and when to choose the most appropriate analytical method.
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The Weighted Average Method of Estimating Expected Future Earnings is Based on the Average or Arithmetic Mean. Here’s Why that’s Important. Companies that are growing in revenue need to be valued regularly, and they need to be valued with their future growth in mind. The weighted average approach is a valuable tool. But Richard Claywell suggests caution in using it to extrapolate large projections of future revenue. Why? Partly because it’s quite often typical for fast-growing companies to experience their most dramatic growth during their early years—and it’s important to focus on current market conditions more than past or imagined…
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There’s Lots We Know about Private Capital. There are Things We Don’t Know, too—and Need to Be Aware of. Robert T. Slee explains in this excerpt several key macro insights—and related themes—that his recent book Private Capital Markets is based on. The macro insights are that corporate finance theory doesn’t predict behavior in private capital markets, and valuation, capitalization, and transfer are not discrete and unrelated areas. Themes include insights on the differences between public and private markets, compliance, relative value, and more.
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Consider Lifetime Client Value, Cost of Client Acquisition, and Retention Rate Is your CPA firm making the most of current relationships and doing all it can to expand into new ones? While there are many metrics CPA firms use to evaluate quantitative performance, AICPA Insights suggests 12 metrics than can provide more qualitative feedback. These metrics can help CPA firms measure their reach with clients and provide insight into how well processes already in place are helping to identify opportunities with clients.
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U.S.-Based Multinationals Reporting Under IFRS Struggle With Classification of Equities, Liabilities The International Accounting Standards Board agreed with respondents from its public consultation (a study that reached out to industry professionals at all levels in more than 80 countries in 2011) that it needs to better clarify definitions of assets and liabilities for debt instruments, CFO.com reports. That, in turn, should help eliminate some uncertainty when accounting for assets and financial liabilities or nonfinancial liabilities (which can include land and equipment leases). More:
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An Interview with Jeremy Levine, a Partner at Bessemer Venture Partners As the new year begins, the Wall Street Journal’s Venture Capital Dispatch — which focuses largely on high-tech start-ups and their investors — has asked several venture capital investors to reflect on the past year and give us their outlook for 2013. Recently, it spoke with Jeremy Levine, a partner at Bessemer Venture Partners. Levine speaks about the return of sanity to venture markets, the need not to overreact to recent investment trends, and the potential in offerings for small businesses.
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IFRS Foundation Trustee: Don’t Wave White Flag on Cooperation Global accounting standard setters acknowledge that completion of the convergence projects is unlikely to happen in the near term, but progress can still be made to closely align International Financial Reporting Standards and U.S. GAAP, the Journal of Accountancy reports. Here’s more:
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A Dozen Categories. Some Categories Alone Encompassing Up to 20 New Taxes. Here’s the Detail. The American Taxpayer Relief Act, passed by Congress on Jan. 1, permanently extends a large number of tax items from the 2001 and 2003 tax acts and extends many expired tax provisions. Here is a comprehensive look at the many changes contained in the bill, as well as other new taxes that took effect Jan. 1. Paul Bonner and Alistair M. Nevius at the Journal of Accountancy report. A full summary of just the main categories is here:
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Extra Help for Puerto Rican Rum, Asparagus Farmers, Hollywood TV Production, 2-3 Wheeled Electric Vehicles, and Diesel Fuel Joe Weisenthal at Business Insider gives us the lowdown:
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Intent: Not to Constrain Economic Growth Which Could Lead to Future Revenues David Lawder and Kim Dixon report that The Congressional Budget Office on Tuesday said Senate-passed legislation to avert the “fiscal cliff” would add nearly $4 trillion to federal deficits over a decade, largely because it would extend low tax rates for almost all Americans.
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Economic Recovery, Intensified Competition, Squeezed Profit Margins, Upward Pressure on Salaries, Downward Pressure on Rates, and a Rush to the Cloud Rick Telberg counts up the list of the top 20 most-clicked articles at CPA Trendlines provides a roadmap to the profession’s anxieties, aspirations and, just maybe, a glimpse into what 2013 holds:
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There’s good news and bad news. Here’s the low-down. Dean Zerbe offers his take at Forbes on how the current deal will affect small-business owners:
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Ambitious plans to overhaul the individual tax code, tackle corporate rates, revamp the Medicare program and consider changes in Social Security appear to have given way mainly to a tax increases for big earners Jennifer Steinhauer of the New York Times reports that “doing business in pieces” seems to be :the nature of what constitutes progress in such a sharply divided political world.” More:
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Health Costs on His Mind, Small Factory Owner Looks for Ways to Cope With New Law Emily Maltby and Sarah E. Needleman at The Wall Street Journal talk with a small business owner outside of Chicago who’s considering ways to manage growth, preserve profit, and comply with the new healthcare law. Automation Systems, with with sales of about $1.6 million for 2012, currently employs 40 full-time workers, mostly low-paid employees who monitor the factory equipment. If sales were to continue to rise, the plant could, conceivably, employ 50 full-time workers in 2014. Under the new health-care law, the Affordable Care Act,…
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CEO’s Message—Fourth Quarter 2012 Parnell BlackMBA, CPA, CVA, Chief Executive Officer Brien K. JonesAccepts Promotion to: Executive Vice President of Business Development Here’s to a Bright Future NACVA headquarters (HQ) is always moving and shaking, but seldom, if ever, do I talk with you about the details of our inner workings. It is not because I fear boring you, because HQ is truly an invigorating place to be. We are a very dynamic organization—constantly changing with always something new and forever moving forward. Frankly, the reason I do not offer much about HQ is…
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Spotlight On Payment Reform, Alternative Care Models, and Physician Employment Agreements Debra Beaulieu at Fierce Practice Management weighs in with Top 10 Physician Practice Trends to watch in 2013, a year that will not only be a watershed for the U.S. healthcare system, but, for many physician practices, a pivotal one professionally—where the’ ability to adapt and evolve may make the difference for many physicians between folding and thriving in a post-health-reform world. Here’s what Ms. Beaulieu foresees as key trends:
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Find Fulfillment, Get Productive, And Create Healthy Habits Drake Baer at Fast Company weighs in with his choice of Top 2012 titles, asserting that “these 12 books have shaped not only the way we work this year, but how we think and the conversations we’re having. Authored by luminaries like Nate Silver, Clay Christensen, and Susan Cain, these delightful-to-read tomes offer insight into the power of vulnerability, habit, social media, and more.” Here are his top three:
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Barnes & Noble’s Missing $500 Million; A Discrepancy Between Physical and Digital Property Values Tom Gara reports at The Wall Street Journal Corporate Intelligence blog that “UK-based publisher Pearson bought into Barnes & Noble’s Nook Media digital business today [12/28/12], buying a 5% stake in the e-book company for $89.5 million and valuing the whole business at just under $1.8 billion.
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Focus is Key to Successful Valuation, Time Management, and Business Growth. Here’s How to Size Up a Project. Rand Curtiss shares insight on queries that allow appraisers to drill down quickly and determine the proper approach and charge for work. What’s the primary goal of the appraisal? Was the last historical year typical—and are there any major atypical facts or circumstances? Find out if the company is in more than one business, and how it differs from competitors.
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Credibility is the Critical Driver of Value for an Expert. Stay on Top With These Best Practices. John Marcus provides guidelines successful expert witnesses abide by: Trust no one, read everything, spend more time thinking and less time computing, and be true to yourself. Here’s why these best practices matter.