Views Developed by an Appraiser Working with Business Brokers to Assess FMV Business appraisers typically assume that Price/Revenue, Price/SDE, Price/EBITDA and Price/EBIT, etc., are independent valuation methods. But, are they independent? This article shares my views on this subject matter and why they will lead to different conclusions of value.
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It seems like it was just last year when we mused if non-GAAP earnings measurements were becoming a permanent fixture of the market. How quickly the times change. Samantha Albert, senior financial analyst with Mercer Capital, explains. To read the full article in Mercer Capital’s Financial Reporting Blog, click: Compensating for Something: Facebook’s GAAP Change. 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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The statute of limitation defines the time within which the IRS may initiate an audit of a tax return. According to Sec. 6501(a), the statute of limitation for income tax returns is three years from the filing date of the return or the due date if the return is filed early. Marilyn Young discusses the issue. To read the full article in The Tax Adviser, click: The Statute of Limitation for Net Operating Losses.
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First things first: Get out of bed. Once you’ve accomplished this, you’re ready for five more tips that can help you minimize interruptions, maximize your time, and make the most of working from home. To read the full article in AICPA Insights, click: 5 Tips to Make Working from Home Successful.
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Unsystematic Risk Premia in Privately Held Companies How does a valuation professional quantify and defend the unsystematic risk premia (URP)? Is the latter a factor that helps explain why CAPM is less frequently used valuing a privately held company? As for Total Beta, is that any better than the use of Beta? In this article, the author suggests if one accepts that imperfect diversification (ID) explains the risk premia, he suspects that the risk level is a function of the buyer pool or market participant pool and that characteristic will validate whether the base URP should be adjusted up or…
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of Accounting and Financial Services Firms In this article, Dr. Frederiksen discusses five key findings derived from a Hinge Marketing Survey of accounting and financial services firms. The findings provide actionable steps and an opportunity for firms serving in the industry to grow.
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Market sentiment seems to oscillate between a preference for growth and a desire for profitability now. Travis Harms, Mercer Capital’s Financial Reporting Valuation Group lead, discusses the challenges of managing and investing in early-stage companies. To read the full article in Mercer Capital’s Financial Reporting Blog, click: If it was Easy, We’d all be Rich. 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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We mentally deposit money in buckets of current income, current assets, and future income. This instinctive categorization explains the popularity of so-called bucketing strategies for retirement income, whether segmented by time or type of spending. Michael Kitces, contributing writer for Financial Planning, explains how advisers can help overcome their irrational expectations. To read the full article in Financial Planning, click: Kitces: A New Hierarchy of Retirement Needs.
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Why Leaders Need to Identify Their Weaknesses Gaining an understanding of your weaknesses as a leader can help you take steps to compensate for them. Working with mentors and asking for feedback from your team can allow you to identify these weaknesses. Jayson Demers, CEO of AudienceBloom, shares some great tips. To read the full article in Entrepreneur, click: How to Recognize Your Biggest Weaknesses as a Leader.
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Its Approach to Approving Franchise Loan Applications This article summarizes changes implemented that affect SBA lending in the franchise context and that became effective in 2017. Within the franchise industry, financing backed by the SBA is one of the most important sources of funding for franchisees who wish to establish or grow a franchise. However, since the beginning of 2017, SBA funding within the franchising industry has undergone a paradigm shift in how the SBA determines whether a franchisee is eligible for an SBA-guaranteed loan. In addition, the article explores the fate of the SBA’s Franchise Registry website and what,…
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Clinical Services (Part I of IV) In the March/April 2017 issue of The Value Examiner, the authors gave a detailed description of how clinical services for physicians can be calculated. QuickRead is pleased to present an overview of this series, which will be presented in four parts. Please look for the more detailed analysis in The Value Examiner.
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In an age of rapid technological change, the traditional corporate R&D process just won’t cut it. Bureaucracy and slow decision making are impediments to a company’s ability to innovate and the speed of execution. As younger companies like Tesla are surpassing incumbents in their industries, the established players need to change to keep up. Megan Richards, financial analyst with Mercer Capital, explores this topic. To read the full article in Mercer Capital’s Financial Reporting Blog, click: Corporate Venture Capital Trends. This article is republished from Mercer Capital’s Financial Reporting Blog. It is reprinted with permission. To subscribe to the blog,…
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Google Chrome is the world’s most popular web browser. Are you using its features as effectively as possible? J. Carlton Collins, CGMA Magazine contributing editor, provides a useful quiz to test your navigation skills in Chrome. To read the full article in CGMA, click: Quiz: How Well Do You Know Google Chrome?
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Access to banking information ensures advisers can perform holistic planning, fintech firms say. Yet, Suleman Din looks into the problem that young digital-first firms hoping to revolutionize the way advisers manage client finances and build their wealth claim they have run into resistance from major banks opposed to sharing financial data. To read the full article in FinancialPlanning, click: Who’s Fighting for Advisers and Clients in Financial Data Debate?
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Effective Opening Statements in Mediation What is an effective opening statement? How does one prepare such a statement? In this article, Nancy Neal Yeend, an experienced mediator, shares the steps and processes that lead to an effective opening statement and how that statement can lead to resolution of disputes.
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The Role of the Forensic Accountant There are a number of instances where damage estimates are uncertain and where a customer is lost. What should one do in these instances? Losses sometimes require reasonable estimates, as well as a reasonable forecasting of the market—both for the generation of revenues and for mitigation. In the case where there is greater perceived loss than a single contract, a forecast is necessary to determine the long-term future lost net profits for the value of the lost customer. Dr. Kreuter shares his views on how to address these more complicated engagements.
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The fading use of equity compensation by more mature companies likely reflects: i) relatively cash-rich treasuries; ii) greater interchangeability of personnel to fulfill work functions; and iii) workers’ risk-tolerances (or lack thereof). Sujan Rajbhandary, vice president and senior member of Mercer Capital’s Financial Reporting Valuation Group, discusses the issue. To read the full article in Mercer Capital’s Financial Reporting Blog, click: People Are Worried About Equity Compensation. 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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The rudimentary definition of forensic accounting is the application of accounting procedures or practices to a matter that may be litigated. Forensic accounting involves the use of intelligence gathering techniques and accounting/business skills to analyze past financial data. Brittni Langel, CFE for McGovern & Greene LLP, discusses how litigation teams will determine if there is a need to use this information in the courtroom. To read the full article in McGovern & Greene LLP, click: What is Forensic Accounting and How is it Used in Litigation Cases?
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What is driving the global surge in M&A deals? In many cases, companies are looking for revenue growth. But how is the pursuit of revenue synergies working out? With less than a quarter of acquirers reporting that they are achieving more than 80% of their target, there is clearly room for improvement. This may not come as a surprise—it is widely understood that revenue synergies are more difficult to achieve when compared to cost synergies. At the same time, some companies are meeting their revenue targets. What are they doing that others are not? In this survey report, we find…
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Apply the Key Person Discount Is there any evidence that a key person discount exists? In this article, Steven Egna, shares his views on the subject matter and provides an illustration of the statistical basis for supporting such a discount.