With Examples From Asset Misappropriation to Financial Statement Fraud (Part II of II) This two-part article (Read Part I here) focuses on the two significant, but different, roles forensic accountants play in quantifying employee losses and how—in the normal course of the analysis—they may find instances of fraud that require further investigation. The authors first provide detailed guidance for forensic accountants in how to quantify employee losses and later offer insights into behavior that may indicate fraud stemming from such claims. They also explain the factors considered by carriers when hiring external accountants. The second part of the article features…
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With Examples From Asset Misappropriation to Financial Statement Fraud (Part I of II) This two-part article focuses on the two significant, but different, roles forensic accountants play in quantifying employee losses and how—in the normal course of the analysis—they may find instances of fraud that require further investigation. The authors first provide detailed guidance for forensic accountants in how to quantify employee losses and later offer insights into behavior that may indicate fraud stemming from such claims. They also explain the factors considered by carriers when hiring external accountants. The second part of the article features two cases studies involving…
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For Financial Reporting Purposes In this article, the author revisits the Market Participant Acquisition Premium (MPAP) issued by The Appraisal Foundation and reiterates the findings regarding what is a premium and what that means.
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From Publicly Traded Companies Where can valuation professionals find compensation data? In this article, Stephen Kirkland discusses leading sources to find compensation of publicly traded companies.
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Insights from the Analysis of Mega Transactions By scrutinizing data from large transactions, valuation experts can glean important information and insights into current healthcare valuations. In this article, Collin McDermott and Bridget Triepke summarize SEC filings, review the implied valuation of large healthcare mergers—based on the purchase price—and provide a detailed review of the fairness opinions provided by investment banks to both Vanguard’s and Health Management Associates board of directors and shareholders. Specifically, the authors detail the results and key assumptions utilized by the investment banks for the GPCM, M&A Method, and Discounted Cash Flow Method.
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Proposed rule amendments for small businesses and additional exemptions under Section 3(b) of the Securities Act On December 18, 2013, the Securities and Exchange Commission released their long-awaited proposed rules on Regulation A+. The amendments to Regulation A were proposed pursuant to Title IV of the Jumpstart Our Business Startups Act of 2012. The proposed rules are intended to increase access to the capital markets for lower middle-market firms since Reg. A has been sparingly used; there were only 19 qualified Reg. A offerings between 2009 and 2012. While pre-revenue firms, start-ups and those in the early stages will not…
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Has the Securities and Exchange Commission given M&A business brokers the “green light” to engage in securities transactions? The Securities and Exchange Commission (SEC) issued a January 31, 2014, No-Action Letter indicating it would not take enforcement action against an M&A broker contemplating a securities transaction.
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US Securities and Exchange Commission (SEC) is Aggressively Policing Fund Valuation Practices in the Hedge Fund Industry Kris Devasabai at Risk.net reports that hedge funds, under pressure from regulators and investors, are establishing robust pricing policies for hard-to-value assets. They are also hiring independent experts to price complex and illiquid assets as investors and regulators intensify their scrutiny of valuation practices. Here’s more:
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Exchange Would Make it Easier for Companies to Go Public in the U.S. But Would be Limited to Experienced Investors Dave Michaels at Bloomberg reports that a Securities and Exchange Commission panel suggested that an exchange limited to small businesses should be created. The exchange would make it easier for companies to go public in the U.S. but would be limited to experienced investors better able to assess the risks involved with lower disclosure hurdles. The Panel said the exchange should be limited to sophisticated investors, which it didn’t define. More:
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Stakeholders Discuss Greater Institutional Investor Makeup, Governance Structures, Greater Regulatory Scrutiny Deloitte Insights contributes a piece to the CFO Journal on the Wall Street Journal site, part of a series designed to provide financial executives a customized resource to help them address the strategic, operational and regulatory issues they face in managing their finance organizations and careers, with top-line digests, research, perspectives and technical analyses. This Deloitte Insight reports on the Third Annual Hedge Fund Symposium Series held in New York recently. There, Joseph Fisher, who leads the Hedge Fund Audit practice for Deloitte & Touche LLP in New York, commented on how…
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For Nearly Five Decades, Securities Law Allowed Banks with Fewer than 300 Shareholders to “Deregister,” Now, Banks With Under 1200 Shareholders Can Do the Same Under Provisions of the JOBS Act Dina ElBoghdady reports some interesting news this week in the Washington Post: about 100 small banks have stopped reporting financial details about their operations to the SEC since the JOBS Act was enacted in April About 100 small banks have stopped reporting financial details about their operations (e.g., revenue, expenses, executive compensation and trends affecting their businesses, etc.).to the Securities and Exchange Commission since April, when a law was enacted that…
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Pay-for-Performance Provisions are a “Triumph of Theory Over Experience,” Writes Bill Keller in “Carrots for Doctors.” “Pay for performance, or P4P in the jargon, is embraced by right and left. It has long been the favorite egghead prescription for our absurdly overpriced, underperforming health care system. The logic . . . If only it worked,” writes former New York Times executive editor Bill Keller, here writing for the Times’ opinion page. More:
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With Limited Resources, the SEC is Using a “Risk Analytics” Strategy to Target Areas of Concern, Explains Exec at Conference Recent examinations of newly SEC-registered private equity firms is helping regulators understand the complex world of private equity, according to delegates and speakers at PEI’s CFOs and COOs Forum 2013 in New York, writes Nicholas Donato at Private Equity Manager. More:
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The accounting rulemakers said they are seeking more feedback about whether groups of companies could phase in IFRS and how investors are dealing with the two sets of accounting rules currently existing in the United States. Emily Chasen at WSJ CFO Report writes [trial subscription required] that accounting rulemakers in the U.S. and abroad are calling for collaboration even as U.S. regulators have so far refused to take a clear position on whether they should adopt international accounting rules. But that lack of guidance makes the timing and nature of such cooperation uncertain, the heads of the U.S. and international accounting…
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Implications of the SEC IFRS Work Plan for Private and Public Issuers; How Slow Adoption May Rewrite GAAP Grant Thornton Audit Services has published a 16-page report providing background and context on IFRS in the United States. The report explores how market forces press the issue, cover SEC final report highlights and reaction to the report, summarizes how some companies are preparing for IFRS today, and offers a set of action steps required to put together a logical, cost-efficient readiness plan:
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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 Commission issued an investor bulletin that said “there have been instances of fraud and other abuses involving reverse merger companies” and that investors “should be careful” when they consider investing in the companies’ stocks. The SEC has said it is investigating the…