This month's issue of Valuation & Litigation Advisory Insights includes the following articles:
IP Valuation Using the Relief From Royalty Method
In today's business environment, the valuation of intellectual property (IP) is critical - both to comply with accounting rules and for purposes of financial reporting, tax compliance, litigation, or sale or licensing transactions. Several methods can be used to value IP. One of the most effective can be the relief from royalty (RFR) method. This income-based method estimates the portion of a company's earnings attributable to an IP asset based on the royalty rate the company would have paid for the use of the asset if it didn't own it.
Click here to read this article.
Valuation Critical Under New M&A Rules
Sweeping changes to the accounting rules for mergers and acquisitions (M&A) will start affecting many companies that are closing deals this year. FASB SFAS No. 141(R), Business Combinations, was issued in late 2007, but it applies to deals closing on or after the first day of the first annual reporting period beginning after Dec. 15, 2008. This article explains how many of the changes prescribed in this 358-page document increase the importance of having accurate valuations.
Click here to read this article.
Putting a Price on Technology
Valuing technology-related intellectual property (IP) can be an enormous challenge for lawyers and valuation experts. It considers the degree of legal protection associated with technology IP as well as the economic benefits a company is expected to derive from that protection. Typically, valuation experts analyze the various economic benefits associated with a technology IP asset separately, and will use different approaches depending on whether a patent is associated with developed technology, in-process research and development, or future technology. There are a variety of contexts in which the need to value technology IP can arise.
Click here to read this article.
Prior issues are available at our E-Newsletter Archive. If you would like to subscribe to this free monthly e-newsletter, send an email to info@skodaminotti.com.
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.
This month's issue of Valuation & Litigation Advisory Insights includes the following articles:
Constructing a Claim for Lost Productivity Damages
Quantifying the cost of lost productivity when a construction project is disrupted through no fault of the contractor is a difficult challenge. An unanticipated disruption of the project typically causes the contractor to work less efficiently, which can lead to additional labor, equipment and material costs. This article explains that appraisers can use several methods when quantifying lost productivity damages, depending on the particular job’s facts and circumstances and also notes that lawyers and damages experts need to work together closely to establish lost productivity and measure it appropriately.
Click here to read this article.
Marketability discounts: Appraisers relying less on empirical study averages
With the widespread availability of public market databases, spreadsheet software and other analytical tools, valuators are no longer relying solely on empirical study averages to determine marketability discounts. They’re now placing greater emphasis on how to identify what truly affects marketability and how to better match empirical data to the specific attributes of each subject company. However, though pre-IPO and restricted stock studies may be somewhat under siege, their data is still worthwhile. Research has generated several insightful hypotheses.
Click here to read this article.
Clues abound: The tax return as an investigative tool
Tax returns can be a highly effective investigative tool in fraud and divorce cases, shareholder litigation, and other situations in which a defendant may have hidden assets. In fact, virtually every page of a tax return can provide clues to hidden assets. Income from wages, taxable refunds of state or local taxes, and retirement plan distributions are just a few of the items on a 1040 that a valuator will review.
Click here to read this article.
Prior issues are available at our E-Newsletter Archive. If you would like to subscribe to this free monthly e-newsletter, send an email to info@skodaminotti.com.
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.
In the fourth quarter or 2009, Northeast Ohio saw a decrease in vacancy rates and an increase in net absorption, indicating that things may be turning around. When the economy will fully recover, though, has yet to be determined with certainty, and real estate companies are still suffering from various challenges including the absence of credit and the economic loss in the value of underlying real properties. Companies can adapt to these challenges and survive in this market, though; click here to learn more.
For more information, post a comment below or contact our Real Estate and Construction Group at 440-449-6800.
With the recent declines in the real estate market, it is important that you ensure your commercial property is valued correctly for real estate tax purposes. In 2009, many Ohio counties reappraised or updated their real property values for the tax year. These new valuations apply through 2012.
Despite the declining real estate market, it is our understanding that most tax values for commercial properties were not lowered for the 2009-2011 tax years in many Ohio counties. Owners of commercial property have until March 31, 2010 to contest the new valuations.
If you own high value properties (office; industrial; apartments) we encourage you to review these updated tax values. We would be glad to discuss with you if a challenge makes sense and also refer you to legal professionals who are equipped to handle these matters.
Please contact our Litigation Advisory Services Group at 440-449-6800 if you have any questions regarding this matter.
This month's issue of Valuation & Litigation Advisory Insights includes the following articles:
- Finding the Appropriate Valuation Standard
- How Valuators Assess the Rising Risk of Fraud
- Lost Profits or Lost Value?
Finding the Appropriate Valuation Standard
Valuation isn't static and can change depending on the purpose of the valuation. This article looks at the three most common standards of value: fair market, investment and fair. It briefly defines each standard and discusses the circumstances in which one standard may be more appropriate than another. The article points out that identifying the appropriate valuation standard up front can minimize confusion down the road. The goal is to arrive at a reasonable and supportable value conclusion in light of all the surrounding facts and circumstances.
Click here to read this article.
How Valuators Assess the Rising Risk of Fraud
The current economic downturn has produced an upswing in incidents of occupational fraud, so it's imperative for businesses to step up efforts to deter and detect it. An important part of the valuation process is identifying potential risks and gauging whether management has taken appropriate action to mitigate those risks. This article explains how valuators evaluate internal controls and corporate culture, tailoring their analyses of fraud risks based on the subject company's size, complexity, industry and goals.
Click here to read this article.
Lost Profits or Lost Value?
Lost profits and lost business value are common measures of damages in commercial litigation. They're also a common source of confusion. What do they have in common? How are they different? Can a plaintiff recover both? This article addresses these questions. A basic understanding of the similarities and differences between lost profits and lost business value can help build a case for business damages or challenge an opponent's calculations.
Click here to read this article.
Prior issues are available at our E-Newsletter Archive. If you would like to subscribe to this free monthly e-newsletter, send an email to info@skodaminotti.com.
If you have any questions about any of these articles, please contact our Valuation & Litigation Advisory Services Group at 440-449-6800.
Powered by Compendium Blogware