How to Silence the Hired Gun While evidentiary rules and ethical codes issued by professional bodies like the NACVA and AICPA prohibit accounting and valuation experts from taking an advocate position, the adversarial nature of the U.S. legal system creates a market which at times demands a “hired gun” expert witness who caters their opinion of damages or business value to that which most convincingly favors the side that hires them. This article discusses an expert’s conceptual quest for unimpeachable neutrality and provides guidance on how to silence the hired gun, maintain one’s integrity, all while staying gainfully employed.
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Analyzing corruption risk should be a key factor in businesses’ research into a new market. Transparency International’s Corruption Perceptions Index indicates corruption worsened in many markets in 2016. To read the full article in CGMA Magazine, click: Why Corruption Risk Should be Taken into Account When Evaluating New Markets.
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IRS Division Releases List of Examination Issues The Internal Revenue Service Large Business and International Division has released a list of 13 issues that could be the focus of upcoming examinations. Tammy Whitehouse summarizes the guidance. To read the full article in Compliance Week, click: IRS Identifies 13 “Campaigns” for Tighter Compliance Scrutiny.
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Maybe I am reading too much into it, but l was struck by how the Ruth’s Chris Steak House in Lafayette, La. was packed on a mid-March Tuesday night. A year ago when I ate there, I was one of maybe a half-dozen people in the restaurant. Jeff K. Davis, CFA, Managing Director of Mercer Capital’s Financial Institutions Group, discusses how people’s reaction of being tight-fisted vs. loosening-up can change quickly based upon perceptions. To read the full article in Mercer Capital’s Financial Reporting Blog, click: Reading the Tea Leaves at Ruth’s Chris Steak House in Lafayette. This article is…
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ANAV Method Illustrative Example This discussion is the final installment of a series related to the asset-based business valuation approach. The prior discussion described the theory and methodology of the adjusted net asset value (ANAV) method. This final discussion presents an illustrative example of the application of the ANAV method.
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For Calculating Future Lost Profits Robert Dunn and Everett Harry published their oft cited Modeling and Discounting Future Damages in 2002. The article laid out the process for assessing future lost profits and discounting them to present value. They argued modeling future losses reduced the uncertainty related to the loss calculation and therefore reduced the risk premium to be included in the discount rate. They also argued modeling future losses and using a risk-reduced, relatively low discount rate was easier for judges and juries to understand. While their discussion on a risk-adjusted discount rate has been somewhat controversial, the need…
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How CIOs and CFOs Can Find Common Ground In many organizations, chief information officers and CFOs are at odds, and their interactions are strained by misunderstandings. Bryan Mueller, principal consultant at ISG, discusses ways to overcome this disconnect, and CFOs can help by promoting cost transparency, hiring the right staff, and building an effective planning process. To read the full article in CFO, click: The CFO-CIO Relationship: Bridging the Gap.
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Cost overruns in cloud projects are common, and a few common problems are often to blame. Issues with data integration, the need for custom code and project-management challenges can all lead to higher-than-anticipated costs. David Taber helps you understand the driving specifics and what steps can be taken. To read the full article in CIO, click: Anatomy of a Cloud Project Cost Overrun.
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For outsiders observing a scandal at a company or organization, the situation often seems implausible or incomprehensible. How did leaders let it happen? Why did so many people go along with the wrongdoing? And for so long? The bigger the fallout, the more we shake our heads in disbelief. Kellogg’s Maryam Kouchaki on understanding—and avoiding—ethical breakdowns. To read the full article in strategy+business, click: Why Good Employees do Bad Things.
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In the Crosshairs of Regulators In this article, Mark Zyla of Acuitas discusses trends in fair value measurements in financial reporting and enforcement actions. Mr. Zyla notes that financial reporting is increasingly scrutinized by regulators. He observes that recent inspection reports of accounting firms that audit publicly traded entities by the Public Company Accounting Oversight Board (PCAOB) have indicated an increasing focus on the audit procedures related to fair value. The Securities and Exchange Commission (SEC) has also showed concerns regarding outside valuation specialists who assist management in determining fair value measurements. The increased scrutiny has put a spotlight on…
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The Adjusted Net Asset Value Method This discussion is the fifth part in a series regarding the asset-based business valuation approach. Previous discussions described the theory and application of the Asset-based Approach. And, previous discussions described the theory and application of the asset accumulation (AA) method. This discussion describes the theory and application of the adjusted net asset value (ANAV) method.
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Form 990-EZ, Short Form Return of Organization Exempt From Income Tax, which can be filed by small exempt organizations that meet certain gross receipts and assets tests, now has 29 help icons on various parts of the form that link to explanations, instructions and other resources, the Internal Revenue Service announced Tuesday. Sally Schreiber, JofA senior editor, explains. To read the full article in the Journal of Accountancy, click: New Form 990-EZ has Help Icons to Aid Exempt Organizations in Filing.
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2016 Saw Record Number of Small Businesses Sold The 7,842 closed deals in 2016 were a record high for business sales, according to BizBuySell. Gene Marks, Marks Group owner, explains that the factors driving the trend were strong business performance, low interest rates, and owners’ desire to retire. To read the full article in The Washington Post, click: A Record Number of Small Business Owners are Selling Their Companies.
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When it comes to money, “enough” is the hardest word to define in the English language. The challenge of defining “enough” extends to corporate managers deciding what cash balance is appropriate. Travis Harms, lead of Mercer Capital’s Financial Reporting Valuation Group, takes us through the data offering helpful tips. To read the full article in Mercer Capital’s Financial Reporting Blog, click: Is Cash Always King? This article is republished from Mercer Capital’s Financial Reporting Blog. It is reprinted with permission. To subscribe to the blog, visit: http://mercercapital.com/category/financialreportingblog/.
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Hotel Business Value QuickRead’s Technical Editor, Roberto Castro, reviews BVR’s What It’s Worth: Hotel Business Value. There are few resources available for business valuation professionals that focus on the valuation of hotels. The “go to” reference books have been Stephen Rushmore, MAI and Erich Baum’s Hotels & Motels: Valuations and Market Studies, a 2001 Appraisal Institute publication, and David Harper’s Valuation of Hotels for Investors, a 2008 EG Books publication. BVR’s Special Report, What It’s Worth: Hotel Business Value, covers some of the ground included in these other publications but highlights opportunities available to business valuation practitioners and takes issue…
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Asset Accumulation Illustrative Example The previous discussion in this series, part III, described the typical methodology and application of the asset accumulation (AA) method of the asset-based business valuation approach. This discussion presents an illustrative example of an AA method business valuation analysis.
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Getting a raise at work is all about picking the right time to bring up the issue and presenting evidence that proves your value. Ginger Dean shares several tips for getting paid what you’re worth. To read the full article in Forbes, click: Six Ways to Ask for a Raise—And Get It.
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Older Americans Upbeat about Retirement, but Savings are Lacking for Some Fifty-nine percent of Americans between the ages of 45 and 65 said they were at least somewhat ready for retirement, according to a survey conducted in the middle of last month. However, 22% of those surveyed said they had saved less than $100,000, and 27% said they had saved nothing for retirement. To read the full article in USA Today, click: Older Workers Feel on Track for Retirement. Are They?
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Charles Ellis writes that market professionals cannot beat the market consistently. Therefore, investors are better off investing through low-cost index funds and focusing on asset allocation to achieve their long-term investment objectives. Jeff Davis, managing director of Mercer Capital’s Financial Institutions Group discusses Ellis’ thoughts. To read the full article in Mercer Capital’s Financial Reporting Blog, click: Charles Ellis on Indexing. This article is republished from Mercer Capital’s Financial Reporting Blog. It is reprinted with permission. To subscribe to the blog, visit: http://mercercapital.com/category/financialreportingblog/.
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Asset Accumulation Method This discussion is the third part of a series. Previous discussions introduced the theoretical concepts and the practical applications of the asset-based business valuation approach. This discussion describes one common Asset-based Approach valuation method: the asset accumulation (AA) method.