Business valuation (BV) reports frequently include information presented in the form of financial statements. The reporting requirements for such financial statements have drawn increased attention as a result of the issuance of Statement on Standards for Accounting and Review Services No. 19 (SSARS 19), Compilation and Review Engagements.   The Journal of Accountancy reports: "When conforming the existing ...

Private Equity Manager reports that with regulators looking over their shoulders, some GPs are playing it safe by hiring third-party valuation advisors to check their numbers. However not all third-party opinions are equal, warns Cindy Ma, managing director at advisory-focused investment bank Houlihan Lokey.  PE Manager's Nicholas Donato talked with her recently.  Here are excerpts:  There was a feeling of ...

The Wall Street Journal's Small Business Blog featured recently a guest column by Antone Johnson on the use, misuse, and misvaluation of intellectual property.  It's probably of interest to valuators and financial consultants who are working with small business owners to value and growth their businesses.   Venture capitalists, angel investors and start-up lawyers these days tend to be obsessed with "intell ...

The most highly anticipated IPO in history didn't put on much of a show. Facebook closed today within decimal points of its opening price of $38. Even so, the company's market cap is higher than McDonald's or Pepsico. Espen Robak is the president of Pluris Valuation Advisors, where he studies and values private companies trading on the secondary market. Derek Thompson at The Atlantic talked to him this morn ...

Accounting for Nuts:  Blame a misalignment of incentives for the scandal at Diamond Foods.    The Wall Street Journal's Holman Jenkins opines:  "Business people talk about "alignment of incentives." The lesson here may concern a peculiar misalignment of incentives."  He explains: Here's the executive summary: Diamond was a cooperative owned by California walnut growers until it became a publicly traded comp ...

Normalization of Income: Where Business Valuation Meets Forensic Accounting At the Legal Intelligencer blog, Terry Silver explains that since buyers and sellers often have differing ideas of a business' true fair market value, normalization is usually a required part of any M&A deal: The valuation of virtually every closely held business requires normalization adjustments. Although these adjustments may ...

Firehoses, Drinking Fountains, and Intrinsic Value CFA Magazine'sChristopher Wright recently spoke with four analysts about the challenges of identifying key share price drivers among the torrent of minutiae. The analysts cover a number of topics, and come from a variety of firms and industries.  Here’s J.B. Groh, CFA, senior research analyst at D.A. Davidson in Lake Oswego, Oregon: [It is largely] about th ...

House lawmakers passed a bill today to overhaul the U.S. patent system for the first time in nearly 60 years, Nathan Koppel notes on the Wall Street Journal Law Blog: The House passed the America Invents Act on a 407 to 117 vote, WSJ reports.  The bill would change how the U.S. grants patents and award them to the party which is “first to file” an invention instead of the “first to invent” it. The change wo ...

David Wanetick, Managing Director at IncreMental Advantage, LLC, a valuation firm with expertise in valuing intangible assets and emerging technologies, based in Princeton, NJ,  opines at The Business Insider: Valuing a patent is complex and imperfect. Below we’ll go into some detail surrounding the methods used to determine a patent’s value. Each is applied under different circumstances, and impacted by ma ...

SEC Wakes Up to Reverse Merger Companies Weeks after several Chinese reverse-merger companies have stopped trading in the US amid widespread fraud allegations, the Securities and Exchange Commission has issued a warning that, hey, maybe investors ought to think twice about those reverse-merger companies.  Okey doke!  Mark Gongloff relays from the Wall Street Journal Law Blog.  The Securities and Exchange Co ...

Forbes reports:  In the last (pre-drinking) session at the D: All Things Digital conference at the Terranea resort in Rancho Palos Verdes, California on Wednesday, we heard from  Marc Andreessen, co-founder of venture capital firm Andreessen Horowitz, and founder of Netscape and various other tech start-ups. Chatting him up: Walt Mossberg and Kara Swisher. Perhaps the biggest takeaway from the session: Marc ...

Have you had a chance to check out the Guard Series™ insurance policies?   Since claims against BV practices and properly credentialed professionals have historically been quite rare, these policies are deeply discounted.  NACVA and Primus Assurance Group (PAG) announced the policies' availability last fall, and since then PAG has built out its web site with lots of detail: Providing Professional Peace of M ...

LinkedIn Features Booming CVA/AVA Activity Have you visited LinkedIn lately?  The NACVA AVA/CVA Certification group as of this writing has 935 members.  Follow the link and join in the conversation! This year is NACVA's 20th Anniversary.  What milestones do you remember being a part of?   QuickRead's Conversations with the Masters staff is preparing for an interview with Shannon Pratt.  Do you have question ...