A Review of the Basics for Lost Profits (Part VI) The first five installments of this series have been a review of the basics for calculating lost profits. In the series, lost profits was defined, the common methods used for calculating lost profits (yardstick, before and after, sales projections, market) were discussed, the court standards for assessing lost profits (foreseeability, proximate cause, reasonable certainty) were reviewed, the way of discounting future lost profits to present value was presented, modeling lost profits calculations and how these factors impact the discount rate were discussed. In addition, this series has addressed the differences…
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Where to Start? In forensic accounting, whether litigation is contemplated or not, the key to the most reliable conclusion is starting with accurate and complete information. Under the best of circumstances, the primary source of this information is your client. On the other hand, when the person or entity you are requesting from is an adversary, there is little incentive for cooperation. Regardless of the side one is on, this article summarizes the various means of finding assets. In forensic accounting, whether litigation is contemplated or not, the key to the most reliable conclusion is starting with accurate and complete…
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Theory into Practice In our literature and at professional conferences, we often discuss the theoretical aspects of our work. For lost profits this includes discussions on the best method for valuing lost profits (before and after, yard stick, but for) or the optimal discount method (ex ante, ex post, or hybrid). Occasionally, these become academic debates with little impact on our “real life” work. This year, I received an assignment that allowed me to apply some of these theoretical ideas to real life circumstances. This case involved stolen intellectual properties and three separate loss categories: lost royalties, lost profits, and…
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(OSB) The OSB technique is indispensable to establish veracity when hearing or reading questions and answers, such as deposition transcripts, expert report content and even daily conversation. You can (and should) use the OSB mnemonic in most of your public and private communications, including if you provide expert witness testimony. And, once you begin applying the technique you will find it indispensable in your forensic practice. The following describes its application. [su_pullquote align=”right”]Resources: Forensic Accounting Academy© Financial Statements—Written Confessions Thriving in Forensics—Practice Instruction for Forensic Operators© The Art & Science of Investigating People & Money©—Behavioral and Financial Forensics [/su_pullquote] Background…
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My Testimonial Experience Prior to Taking the Witness Stand One unintended consequence of writing unimpeachably neutral expert reports is that often nobody wants to hear what you have left to say. After having spent nearly two years working as an expert witness, authoring an uncounted number of expert reports, subpoenas, discovery requests, deposition questions, and cross-examination questions, I had yet to testify in a single trial or deposition. Getting a chance to testify had become my Red Ryder, carbine action two-hundred shot range model air rifle. With each case that settled, I couldn’t help but to feel like the forensic…
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Part II of III This is Part II of a three-part series discussing the basic components of a professional liability lawsuit brought against an accounting firm and its partners and the factors a firm’s managing partner should take into consideration before and during this type of litigation for utilizing applicable insurance coverage, maximizing effectiveness of defense and, where possible, bringing the controversy to conclusion by settlement. Part I covered the current litigation environment for accounting firms, relevant provisions in engagement letters, responding to subpoenas, professional liability insurance, and the risk of instigating a professional liability counterclaim in a fee-collection action.…
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Advise for Budding and Experienced Experts The third edition of The Comprehensive Guide to Lost Profits and Other Commercial Damages is marked departure from the prior editions. This two-volume set is replete with valuable information and insight from experienced practitioners.
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Effective Trial Preparation and Presentations What is the role of a financial expert? How important is the financial expert? In this article, the author answers these questions and shares his experience serving as a damage expert.
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Anticipating questions allows us to think through the best ways to phrase our responses Questions about an expert’s skills and work can be phrased in ways that make it difficult to answer accurately on the spot, but advance preparation can smooth the process.
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Maintaining Professionalism Under Pressure and Under Oath Different legal professionals can use vastly different deposition techniques. John R. Markel shares two starkly different experiences with depositions, and details how to prepare yourself for the standard questions as well as how to cope with curveballs.
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How to Maintain Independence and Professionalism in a Complex and Changing Niche As divorce laws change, attorneys increasingly rely on financial experts such as business appraisers and forensic accountants. In this article, Robert D. Feder discusses the role of a financial analyst in the context of matrimonial law. He also covers some of the potential pitfalls of the trade.
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In Nebraska, Judge Considers: Should Damages be Limited to the Length of a Non-Compete Clause? The Supreme Court of North Dakota prefers the testimony of an accredited appraiser, a Tennessee court asks an expert witness to stick to the topic rather than allowing him to recommend an alternative legal remedy, and a Nebraska court considers whether damages should be limited to those incurred during the period of a non-compete agreement. Find out the details.