Nathan J. Mueller embezzled $8.5 million in barely four years from financial giant, ING through a series of corporate incompetence, “happy” accidents and missteps inside the company. His case is unique in the amount of money he stole and the length of time it went undetected. The breach of controls at ING was astonishing, but not nearly as incredible as hearing Mueller describe how easy it was in his ...

Know your data! Understanding the data that is applied in an analysis is important. Data that relies on standard industrial classification (SIC) codes can be misleading for industries that have changed—or did not exist—in 1987. As business models and industries evolve, it pays, as Bob Bridges explains in this article, to do a closer analysis. ...

Handling lawyers who coax you to work from their summary of the evidence Expert witnesses have an ethical responsibility, as well as a business imperative, to ensure they review the actual evidence that supports their analyses. Because expert witness testimony can make or break litigation outcomes, consultants cannot risk having their testimony excluded by the trial judge or discredited by the jury. ...

  The Financial Accounting Standards Board (FASB) has issued two standards updates with the intention of simplifying the measurement of inventory and eliminating the requirement for extraordinary items. Inventory (Topic 330): Simplifying the Measurement of Inventory would eliminate existing requirements to consider the replacement cost of inventory and the net realizable value of inventory less an appr ...

Three key elements of fraud risk assessment Organizations that have not performed a fraud risk assessment may be two-thirds more likely to suffer a fraud-related event, states KPMG-endowed fraud and forensic accounting professor Larry Crumbley. Learn the three key elements that a company’s fraud risk assessment should address. ...

Calculation engagements require development standards A proper calculation engagement requires planning, mutually agreed upon procedures, and adherence to professional standards. Otherwise, the valuation analyst and firm risk damaging their good name and reputation. ...

Reconciling compliance with multi-agency valuation standards While standards exist to uphold the integrity of business valuation, multi-credentialed professionals can face a daunting task when trying to compare and comply with all guidelines across the spectrum of issuing agencies. This article seeks to root out possible conflicts and create clarity among standards so valuators may perform with less effort ...

When the usual approaches won’t work Technology and innovation expert and professor, Tim Swift, proposes an alternative to the traditional Market, Income, and Cost approaches to valuing a patent portfolio. ...

Deviations for biased cash flows Cash flows vary, and traditional approaches need to take into consideration the downside or cessation probability; otherwise, the value of the entity is overstated. Setting the probabilities of "downside" and "cessation" risk drives the appraiser's efforts in adjusting for biased cash flows. This article presents an approach that can be used to adjust the cash flow. ...

Think like an investor, not an accountant! If fair market value is to determine investor expectations and equity risk; then why do these factors receive limited or no consideration when opining on the level of impairments (investor concessions) ubiquitously referred to ask discounts? This article addresses the business risks associated with asset-holding companies' equity that should be considered and repor ...

Ways to prevent costly misunderstandings One of the most important documents valuation, forensics, and litigation support experts produce is the engagement letter. Just as you painstakingly explain what your firm plans to do, it’s also imperative to explain what the client needs to do. ...

CPAs can increase billings by catering to exiting baby boomer business owners. Baby boomer businesses may represent a material percentage of a CPA firm’s clientele. As a record number of these business owners begin the succession/exit process, hidden opportunities exist for firms to increase billing, if you know how to spot them. ...

Breaking down invisible value Read Part 1 here. This overview is the second half of Robert Reilly’s series that examines the types of intellectual property analyses, different standards of value that may apply in valuation as well as the alternative types of intellectual property ownership interests and the alternative terms of intellectual property ownership interests. Finally, it offers a discussion regar ...

Limiting the potential for abuse and delay Discovery can reduce the costs of litigation, but it can also be used to harass and delay. There are a number of things that counsel and a forensic professional can do to limit the misuse of the discovery process, save costs, and lead to a settlement. ...

A standard distinct from the fair market value standard The fair market value is distinct from the commercial reasonableness standard. The article highlights how these standards are applied in a healthcare transaction and why it is important to distinguish these standards. ...

Capitalizing on the trend The need for transition planning services has grown over the years and will continue, representing a lucrative and successful practice area for financial professionals. Harry Haigley, CVA, MBA, explains what practitioners can start doing to build their practice today. ...

Benchmarking the firm’s performance We all know financial ratios are a barometer of the health of a company. Now, let's help our client's unleash the power of these ratios to improve their businesses. Here's how. ...

Compensation for PCPs is increasing The increasing supply shortage of primary care physicians (PCPs) will have a significant impact on physician compensation. In turn; this will have an equally powerful effect on the valuation of PCP practices. ...

  More than a decade in the making, the Financial Accounting Standards Board (FASB) and the International Accounting Standards Board (IASB) have released a converged standard on revenue recognition. Titled, “Revenue from Contracts with Customers”, the standard is designed to enhance the process of revenue reporting and improve comparability in financial statements among corporations using IFRS and U.S. ...

  In a windfall for the IRS, 77,000 foreign banks have turned over data on American account holders as part of the Foreign Account Tax Compliance Act (FATCA). The U.S. devised tax law with global reach requires all foreign banks to submit full data on all American accounts with a balance of $50,000 or more. Financial institutions that are non-compliant risk being frozen out of U.S. markets and a 30 per ...