Valuation & Litigation Advisory Blog

• Reality TV and Related Party Transactions in Litigious Valuation Engagements
• Impact of Government Contracts on Subject Company Risk
• Tax Court: Subsequent Sale was Best Evidence of Fair Market Value

Reality TV and Related Party Transactions in Litigious Valuation Engagements
By Sean Saari, CPA/ABV, CVA, MBA

My wife loves "reality" TV shows - Big Brother, Survivor, The Bachelor, The Apprentice, pretty much any show on Bravo, and the list goes on.  My idea of a "reality" show is a football game, but since the people in charge of the NFL can't seem to agree on how many billions of dollars players and owners should make, I may end up having to watch more of my wife's reality shows this fall.  As I watched an episode of Extreme Home Makeover with her the other week, I thought to myself, "How 'real' are these 'reality' shows?"  When was the last time that you heard anyone say "uh" or misspeak during an interview on one of them?  While certainly some reality shows are more real (The Amazing Race) than others (The Hills), there is much more staging and preparation than the producers want us to realize.  It is not uncommon to run into such "staging" in litigious valuation engagements as well, particularly in regard to related-party transactions.  In such situations, it is important for the valuation expert to get a solid and supportable understanding of the underlying characteristics of related-party transactions so that they can be appropriately accounted for in determining the value of an ownership interest.

Click here to read the rest of this article, recently published in National Litigation Consultants' Review.

Impact of Government Contracts on Subject Company Risk

Companies that generate a large part of their revenues from the federal government have different characteristics than those that don't - particularly regarding risk factors. Business Valuation Update recently interviewed Dan Golish, CPA/ABV, CVA, CFF, a Senior Manager with Skoda Minotti's Valuation & Litigation Advisory Services Group, about engagements in this market segment.

Click here to read this interview.

Tax Court: Subsequent Sale was Best Evidence of Fair Market Value

This article discusses a case in which the U.S. Tax Court discussed the impact of post-valuation-date sales on fair market value as well as the importance of choosing an experienced, qualified valuation expert. The court found that the sale of a partnership interest, which was agreed to six months after the valuation date and completed nearly four months later, was "probative" of value, but not "conclusive." The case illustrates the significance of considering subsequent sales in valuing a business interest.

Click here to read this article.

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If you have any questions about any of these articles, post a comment below or please contact our Valuation & Litigation Advisory Services Group at 440-449-6800.