COVID-19 and Business Valuation—One Year Later: What Worked and What Didn’t On March 2, 2021, Jim Hitchner, Managing Member of Valuation Products and Services (VPS), made a follow-up presentation, COVID-19 and Business Valuation—One Year Later: What Worked and What Didn’t. This article summarizes the issues discussed during this follow-up webinar. A year has passed since the COVID-19 pandemic first impacted ...

These Drivers Quantify the Time and Money You Get from Your Practice Time and money. These are two things we generally want more of. Because they are generally two things, we think we don’t have enough of. If you want more time and money than you are currently getting out of your practice, this QuickRead deconstruction is for you. Time and money. These are two things we generally want more of. Because they ...

in the Cryptocurrency Economy Although cryptocurrency and blockchain technology create an environment that can help combat fraud within their systems, their introduction into the global economy has opened numerous doors for nefarious activity. This article provides an overview of what is cryptocurrency, blockchain technology, and the rise of threats to digital assets. Fraud used to be much simpler for the f ...

Employing Open Source Data, OSINT, and SOCMINT in the Due Diligence Phase Today’s accountants specialize in document management, research, money laundering, inter-national banking, e-discovery, and much more. They go even further. They ask to learn about open source research, cryptocurrency, and network-based financial transactions. In this article, the author discusses how to use public record resources, s ...

Put on the Gloves, Speak Bluntly, and Devise a Plan to Emerge from Chaos The author shares the trials and tribulations involving a troubled company that was on the verge of closing and managed to recover. In this engagement, he took the lead, coordinated and assigned roles within the company, negotiated with the IRS Revenue Officer, had difficult conversations with bank (a potential deal breaker), and was c ...

Why it Matters Distinguishing between enterprise (or business) goodwill and personal (or professional) goodwill can sometimes be difficult. That distinction is often necessary in marital dissolution and shareholder dispute cases, and when a business is sold. For valuation purposes, the classification is important because prospective buyers will only pay for goodwill that is transferable. In addition, there ...

Valuation Implications On November 20, 2020, the Centers for Medicare & Medicaid Services (CMS) issued a final rule to modernize and clarify the Stark Law. The Stark Law governs those physicians (or their immediate family members) who have a financial relationship with an entity, and prohibits those individuals from making Medicare referrals to those entities for the provision of designated health servi ...

Confessions of the Pricing Man, How Price Affects Everything Financial experts often struggle with setting fees for their own services and expertise. It is easy to see how someone could have trouble with decisions involving hourly billing versus fixed fees, premium pricing, bundling, discounting, and adjusting for scope creep. The author in this article shares insight from Hermann Simon on the above conside ...

Apropos Restrictions of Data, Time, and Financial Resources When uncertainty rises to a level—where facts appear to be indistinguishable from fiction—business valuation, forensic accounting, and litigation support must prioritize the virtues of unimpeachable neutrality, integrity, and objectivity. These three virtues provide a means of best assisting the trier of fact in distinguishing that which is mislead ...

If I Were Starting Today Business valuation and financial litigation services (BVFLS) practitioners—since the COVID-19 disruption—have embraced the use of social media. Yet, some BVFLS practitioners remain on the sidelines. In this article, Rod Burkert shares 10 social networking tactics he would use today to build his BVFLS practice. One thing I have seen since COVID-19 began is the uptick in social media ...

the Value of a Business Buyers look at earnings as a primary driver of value. There are many other factors such as strategic value, competitive position, branding, secret processes, and cost to duplicate. There are also many other factors, some not so evident or obvious, some intangible and some in the “good feelings” attitude about the business or its prospects. At the end of the day, it is sometimes hard ...

Accounting Challenges and Judgments Topic 606 of the FASB’s Accounting Standards Codification (ASC 606) dictates the timing and amount of revenue companies recognize for a given transaction. ASC 606 requires companies to identify performance obligations in contracts with customers and allocate the transaction price among those performance obligations. Revenue is recognized when control of an asset is transf ...

Pack the Toolbox With Preparation, Information, Persuasion, and Closure It does not matter if you are negotiating with a client, attorneys on the other side of a case, co-workers, or a family member, the more negotiation tools in the proverbial "toolbox" the better the outcome. There are several key areas that one needs using this toolbox to focus on and those include: advance preparation, persuasion, acqui ...

Moving Forward During COVID-19 The COVID-19 pandemic has brought difficulties and major lifestyle changes for most of us. This is particularly true for the business world. Some firms have been negatively impacted. Some businesses have benefitted from the change in our lifestyles. Because causation is an important consideration in commercial damages cases, experts assigned to estimate lost profits must consi ...

Perceived Value is the Driver Alan Weiss wrote a book titled Value-Based Fees, How to Charge - and Get - What You’re Worth. Even though the book was published more than fifteen years ago, it still offers pearls of wisdom for consultants today. One key takeaway involves recognizing the importance of perceived value, which should be the basis of the contractual relationship. Alan Weiss wrote a book titled Val ...

A Business Valuation for a Controlling Interest CPAs are subject to multiple standards. Often, the standards prevent CPAs from exercising their judgment or applying common sense. The author describes this as “miss[ing] the boat.” This article illustrates this and provides an actual example where a group of valuators missed the boat. The purpose here is not to belittle, but to prompt CPAs to reflect on how t ...

Beyond the Tale of the Three Bears Terminal values deserve substantial attention for the reason that that is where (most of) the value is found. Some approaches to terminal value tend to result in higher values, whereas other approaches tend to result in lower values. This article provides some insight into the implied assumptions and relative biases of these approaches. Terminal values deserve substantial ...

Here is How I Changed my Mindset Asking for a referral may seem egotistical and a bit self-centered, but it is also a good business practice. In this article, Rod Burkert shares two personal obstacles he overcame that kept him from asking for referrals and what changed his mind on this matter. When it comes to building a pipeline of work, referrals are the lifeblood of a BVFLS practice. So why did I feel so ...

Reconsidering the Use of CEFs as a Proxy for DLOC The market pricing of publicly traded closed-end funds based on net asset values is not a reliable proxy for estimating discounts for lack of control for closely held businesses having a portfolio of marketable securities. Despite the acceptance for decades by the highest courts of this valuation method, the author, in this article, sets forth the basis for ...

Operational Finance—A New Way to View your P&L? Have you ever thought about your accounting systems as more than an expense, and how it may benefit you, above and beyond reporting numbers and forms? It can and should be more than an expense. In this article, the author discusses the potential insight gained by tracking the data. Books and records. Bookkeeping. Accounting. Tax returns and quarterly filin ...