A Legislative Approach? In April of 2023, the United States Department of Labor (DOL) committed to move forward with a regulation to clearly detail “adequate consideration” in section 408(e) of the Employee Retirement Income Security Act of 1974 (ERISA). For decades the DOL has utilized litigation versus heeding Congress’s edict to enact regulations regarding adequate consideration and it seems as though ac ...

How AI is Transforming the Industry Artificial Intelligence (AI) represents a paradigm shift in the realm of computational capabilities, transcending traditional boundaries of machine functionality to emulate human-like intelligence. AI has made remarkable advances in recent years due to the availability of massive amounts of data, powerful computing resources, and innovations in methods and architectures. ...

Factors to Arrive at a Value that are Beyond the Three Approaches This article addresses valuations for buy/sell transactions with private buyers and private sellers. A business owner calls and says: I want to sell my business. Can you tell me what it’s worth? Thousands of these transactions are occurring daily. But before you go any further, stop and ask more questions. As business valuators, we are condit ...

A Process to “Right” the Company Often later-stage, venture-backed companies (“late-stage start-ups”) seek advice as they find themselves languishing in the neverland between being heavy on intellectual property (IP) assets and light on commercial products or services. Typically, we are contacted by an investor or board member who has become fatigued by management’s assertions that ultimate success is ‘just ...

Refreshing Our Vision for Our Work Appraisal is one of the oldest and most universal human habits. Humans have been appraising since the beginning of time. Appraisal is also a uniquely human habit requiring a spectrum of skills and thought processes that are not found in nature or machines. While often impugned for being faulty and having a variety of biases, our ability to “appraise,” assess, form judgment ...

Who Really Owns the Company!? Have you heard about the Corporate Transparency Act (CTA) Beneficial Ownership Interest Reporting (BOIR) requirements? The penalties for non-compliance are $591(adjusted for inflation) a day up to $10,000 and/or two years in jail. This article outlines the requirements for small private companies and ends with some suggestions for business valuation analysts. Have you heard abo ...

Use in Private-Business Valuation (Part II) This article in this continuing series explains the Implied Private Company Pricing Line (IPCPL), theory, evidence, and application of the IPCPL. How to Understand IPCPL Theory In the first article in this series (published in two parts 02/01/24 and 02/08/24), it was shown that the Implied Private Company Pricing Line (IPCPL) theory explains and predicts the relat ...

In Your Expert Report This article includes tips for preparing an expert report but is not intended to be all inclusive. In addition to these points, remember to carefully consider professional standards, including those that are non-binding, and any code of ethics. Also prepare your report with the expectation of a Daubert motion or similar challenge to your qualifications and/or methodology. The Federal R ...

How to Manifest a Better, More Fulfilling Valuation Practice Several months ago, a friend of mine gifted the article’s author a book entitled The Seven Spiritual Laws of Success: A practical guide to the fulfillment of your dreams, written by Deepak Chopra. A few of the sections within the book hit home more than others and the excitement that has inspired the author to write the article herein. The author ...

Use in Private-Business Valuation (Part II of II) This two-part article in this continuing series explains the implied private company pricing line (IPCPL). Read Part I here. IPCPL explains and predicts how buyers and sellers of capital assets in private markets set risk-adjusted discount rates under conditions of non-zero transaction cost differentials between public and private markets; and, accordingly, ...

The Death of Testimonial Overstatement The proper interpretation for the standard of admissibility under the amended Rule 702 of the Federal Rules of Evidence will hopefully result in an evidentiary change that flies in the face of every hired gun’s essence, as the real impact of the trial court truly being a gatekeeper is that it will shield the jury from the testimonial overstatement salaciously proffered ...

Use in Private-Business Valuation (Part I of II) This two-part article in this continuing series explains the implied private company pricing line (IPCPL). IPCPL explains and predicts how buyers and sellers of capital assets in private markets set risk-adjusted discount rates under conditions of non-zero transaction cost differentials between public and private markets; and, accordingly, IPCPL explains and ...

Forthcoming Changes in Gift and Estate Tax Thresholds In the complex world of gift and estate tax planning, significant changes are on the horizon. The 2026 sunset, a date circled in red on the calendars of tax professionals and high-net-worth individuals, potentially signifies the end of the current, more generous tax-free lifetime estate and gift tax thresholds. The authors share their thoughts on how the ...

and Business Valuations This article delves into the key factors that shape the value of healthcare services, from cost behavior to pricing strategies, and offers insights into how valuation professionals can navigate this complex terrain. "Healthcare services are a fundamental necessity, and understanding the key drivers of value in medical practices and healthcare businesses is essential for conducting a ...

Ethical and Practical Implications Too many appraisers omit the contingent BIGL in their appraisals. It certainly is easier to yield to the pressure of estate attorneys, CPAs, and the IRS on this point, but in light of the evidence for inclusion, is this the ethical path? The author discusses the merits and ethics of including the BIGL. Too many appraisers omit the contingent built-in capital gain tax liabi ...

Normalization Adjustment Steps and Practice Pointers Reasonable compensation is among the most common of all normalizing adjustments in valuations of closely held businesses. The dollar amounts involved can be significant, the issues can be complex, and the valuator’s conclusions can be controversial. In preparing to make these adjustments, there are a series of steps that are normally followed. Among the s ...

Part III of III This article is the third and final of a three-part series on intangible property and property tax appraisals. Read Part I here and Part II here. Valuation analysts are often retained by industrial and commercial companies to assist with state and local property tax planning, compliance, and controversy matters. Often, analysts are retained by the legal counsel for the corporate taxpayers. T ...

The Role of a Neutral Third-Party Valuation Expert as an Umpire in Partnership Deadlocks Partnerships are common structures in professional service practices, offering opportunities for synergistic collaboration. However, conflicts can arise, especially in the absence of a well-contemplated equitable profit-sharing formula and a deadlock-breaking mechanism in the partnership contract. This article explores ...

Part II of III This article is the second of a three-part series on intangible property and property tax appraisals. Valuation analysts are often retained by industrial and commercial companies to assist with state and local property tax planning, compliance, and controversy matters. Often, analysts are retained by the legal counsel for the corporate taxpayers. This is particularly the case when the propert ...

Part I of III This article is the first of a three-part series on intangible property and property tax appraisals. Valuation analysts are often retained by industrial and commercial companies to assist with state and local property tax planning, compliance, and controversy matters. Often, analysts are retained by the legal counsel for the corporate taxpayers. This is particularly the case when the property ...