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Do you know what your business is worth? Our business valuation experts provide you with an objective, expert view of your company – while helping you understand the value drivers of your business. In addition to preparation for sale, knowing the actual value of your business is crucial for a number of reasons:
Your business' balance sheets and financial statements are not enough to present the true value of your company. An accurate valuation requires a customized approach. Our Certified Valuation Analysts integrate basic valuation principles with the very latest developments in business valuation theory to arrive at the most comprehensive valuation possible. We can also help you comply with the complex requirements of the Statements of Financial Accounting Standards (SFAS) Nos. 141 and 142. These standards require companies to perform a valuation to determine the current fair value of intangible assets and goodwill acquired in a business combination or merger and to periodically test previously recorded goodwill and intangibles with indefinite lives for impairment. For more information about our Business Valuation practice, email BVLS@SCandH.com or call (410) 403-1500 | (800) 832-3008.
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Quarter 4, 2008 Welcome to Valuation Insights — a complimentary service presented quarterly to our friends in the legal and consulting professions. We hope that you will find the topics, articles, and court case abstracts relevant, timely and informative. SC&H Group is one of the fastest growing CPA and management consultant firms in the country. We have been named to the Inside Public Accounting Best of the Best list of America’s Top CPA firms for ten consecutive years, and we have been named one of the Top 100 Firms by Accounting Today every year since 2005. With office locations in Maryland, Virginia, and Georgia, SC&H has a national client base ranging from emerging businesses to Fortune 500 companies. The firm’s service offerings include business valuation, litigation support, comprehensive accounting, tax and business advisory services, and state and local tax services. Please contact us if you would like additional information on any of these topics or to discuss ways we may be of assistance to you in your client matters.
Michael J. Young, CPA/ABV, CVA Nathan E. DiNatale, CPA/ABV, CVA, CFE
Arguments for Applying Fair Value Standard in Divorce
Most state courts apply the fair market value standard when appraising the value of closely held businesses in divorce. These courts generally define fair market value by reference to IRS Revenue Ruling 59-60: the price a willing buyer and seller would agree on when neither is under any compulsion and both are knowledgeable about the business. Click here for the full article
Divorce Court Considers Discount for Lack of Control For a 50% Interest Bussa v. Bussa, 2008 WL 2117138 (Michigan) (unpublished) Where is the line between an appraiser advancing a client's best interests and maintaining an air of detached neutrality? This unpublished divorce case from the Michigan Court of Appeals offers insight on maintaining that fine balance and emphasizes the wide discretion of trial courts in determining questions of value. Click here for the full article
Court Considers Built-in Capital Gains Deduction In Applying Fair Value Murphy v. U.S. Dredging Corp., 2008 NY Slip Op 31535 The Eleventh Circuit Court of Appeals’ recent reversal of the U.S. Tax Court in Jelke v. Commissioner established a 100% discount for built-in capital gains when appraising holding company assets at fair market value, at least in the estate and gift tax arena (and following Fifth Circuit precedent). But what of shareholder oppression and dissent cases: These typically apply a statutory fair value standard, on a going-concern basis—as compared to Jelke’s assumption of a hypothetical liquidation on the valuation date. When conducting a statutory fair value appraisal, is it appropriate to deduct the full, current value of imbedded capital gains? Click here for the full article
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