Book Review This fall, the American Bar Association released Shannon Pratt’s The Lawyer’s Business Valuation Handbook 3rd Edition. This publication has been edited by Roger J. Grabowski, FASA and Alina Niculita, ASA, ARM-BV, CFA, MBA. It is a comprehensive guide for attorneys (and judges) to enable them to better understand the substance and basis of the valuation expert’s work. In this article, Michael G. ...

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 ...

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 ...

It is all Based on Your Perspective The purchase price of a transaction can look vastly different. Therefore, when considering the prices of various transactions, it is important to know how those prices have been calculated so that one has a consistent perspective and is not comparing apples to oranges This article illustrates the various perspectives that may emerge in connection with a purchase price. Wi ...

Part III of IV This four-part article summarizes what valuation specialists in all property appraisal disciplines (herein called “appraisers”), company managements, and their legal counsel need to know about property appraisals prepared within a bankruptcy environment. For purposes of this discussion, the term property includes real estate and real property, tangible personal property, and intangible person ...

Part II of II This is the second of a two-part article (read Part I) related to the proposed (mostly) GAAP-based income tax in the (perhaps fatally wounded) Build Back Better Act. While the Build Back Better Act may be dead, the GAAP-based income tax is a polarizing concept that may be resurrected soon. The first part focused on why there is a push by some—and pushback by others—on such a tax. The second pa ...

Part I of II This is the first of a two-part article related to the proposed (mostly) GAAP-based income tax in the (perhaps fatally wounded) Build Back Better Act. While the Build Back Better Act may be dead, the GAAP-based income tax is a polarizing concept that may be resurrected soon. The first part focuses on why there is a push by some—and pushback by others—on such a tax. The second part imagines some ...

Elements of the Valuation Analysis (Part II of V) This second article of the five-part series on Intellectual Property Valuations summarizes the typical elements of the intellectual property valuation analysis. This part of the discussion focuses on benchmarking and the use of research databases. [su_pullquote align="right"]Resources:Intellectual Property Valuations: The Relief from Royalty Method (Part I o ...

The Relief From Royalty Method (Part I of V) This is the first article of a five-part series that focuses on what valuation analysts and owner/operators need to know about one category of intangible property: intellectual property. There are generally accepted cost approach, market approach, and income approach methods that may be used to value intellectual property. This discussion focuses on the applicati ...

Why it Matters This article examines the major nonconformance issues the average valuator may face, where to find the information necessary to investigate, and how to make the adjustments to conform with GAAP. The adjustments discussed are not exhaustive but do cover the more common adjustments valuators should consider. While a valuation is not an audit, the valuation analyst must recognize material deviat ...

Finance & Accounting for Lawyers, Second Edition, by Brian Peter Brining, JD, CPA BVR has just released Finance & Accounting for Lawyers, Second Edition, by Brian Peter Brining, JD, CPA. The purpose of this edition is to provide the reader, lawyers particularly, with a technical overview of accounting principles and methods so the knowledge can be applied in the practice of law. In the finance and v ...

Buyer and Seller Beware When a privately-held acquirer uses its stock to partly purchase a company, it is imperative that both the acquirer and the target in a transaction have support for, and a level of comfort with, the value assigned to the acquirer’s shares if they are being issued as part of the deal. It is especially important for the seller to conduct its own due diligence to better assess its risk ...

It is all Based on Your Perspective In this article, the author presents three common ways that a single purchase price may be calculated and presented. With football season on the horizon, I cannot help but think about September 24, 2013—a night that many football fans will not soon forget. The Seattle Seahawks were playing the Green Bay Packers on Monday Night Football. The game was going down to the wire ...

on Corporate Income Taxes What corporate tax rate should valuation practitioners use going forward given the current environment? Despite corporate rates being “permanent”, is that so?! How should practitioners handle temporary differences? How do we decode a financial statement? In this article, the author shares his thoughts on how valuation professionals should approach a valuation engagement in this unc ...

Must Know Accounting Rules Earnouts are often used in transactions to bridge the gap between what a buyer is willing to pay up front and what a seller wants in the way of total compensation to complete a deal. Therefore, earnouts are typically constructed to allow the seller to enjoy additional upside if the acquired company reaches certain performance targets after the sale while providing the buyer with d ...

New lease accounting standards come into force at the start of next year which will fundamentally change how companies can report off-balance sheet financing.  How will the new rules affect finance leaders? To read the full article in Accountancy Age, click: Lease Accounting Standards: Are Multinationals Sitting on a “Leaseberg” of Huge Proportions? ...

The implementation effort surrounding FASB’s new revenue recognition standard is nearing an end for many companies; the deadline for compliance for public companies is the beginning of 2018.  Despite the years of preparation, certain aspects of compliance, particularly the complex disclosure requirements, are being left to the final hours.  Some companies are playing catch-up, scrambling to have their discl ...

The FASB is conducting early stage research about developing an accounting standard for digital currency and the technology that underpins it.  With the use of digital currency increasing, proponents say inconsistent accounting practices are becoming a problem. To read the full article in Thomson Reuters, click: Bitcoin Seeks Recognition from U.S. GAAP. ...

and its Application to Enterprise Valuation The value of a firm must equal the value of the claims on its assets. In practice, this is generally expressed as the value FIRM = value DEBT + value EQUITY. Similarly, in a balance sheet prepared in accordance with generally accepted accounting principles (GAAP), assets = liabilities and equity. By comparison, an economic balance sheet is constructed using market ...