Valuation & Litigation Advisory Blog

This month's issue of Valuation & Litigation Advisory Insights includes the following articles:

• FAQs About Business Valuations
• Measuring the Intangible: Valuation Issues in Health Care Transactions
• Single Price Quote Supports $10 Million Lost Profits Award
• Skoda Minotti Employee Recognized For Outstanding Report Writing

FAQs About Business Valuations

From business acquisitions to estate planning to shareholder transactions, executives often run into situations in which performing a business valuation is necessary.

The primary pressure point is when it is necessary to determine the value of an ownership interest in a private company (non publicly-traded) for any number of financial and business reasons. Not anything that is traded on exchanges; we're talking about closely-held companies and small businesses.

Click here for the answers to these FAQs:

• In what scenarios would a business valuation be needed?,
• What are some critical factors in determining the value of a business?
• Do values change over time?
• How can valuation discounts impact the value of a business?
• Who typically performs business valuations?
• Why are credentials important?

In the highly complex and heavily regulated world of health care, business valuations can be particularly challenging. This article looks at a recent U.S. Tax Court decision, Derby v. Commissioner, that illustrates this point. The case involved the sale of a medical group to a not-for-profit health care organization. The group claimed charitable tax deductions resulting from the transaction but the Tax Court denied the deductions, concluding that the physicians were unable to show that the value of what they received was less than the value of what they transferred. The article discusses the ins and outs of the case, noting that the court's decision demonstrates that valuation in the context of a health care transaction requires a valuator to look at intangible benefits and other relevant terms of the deal.

Click here to read the rest of this article.

Single Price Quote Supports $10 Million Lost Profits Award

A U.S. Court of Appeals affirmed a jury award of nearly $10 million in lost profits. Notably, the plaintiff's damages expert based his calculation on a single price quote by the plaintiff that had never been accepted by the defendant. This case confirms that companies are entitled to compensatory damages not only for designs and other confidential information they develop, but also for the profits their intellectual property is expected to generate.

Click here to read the rest of this article.

Skoda Minotti Employee Recognized For Outstanding Report Writing by National Association of Certified Valuation Analysts

We are pleased to announce that Sean Saari, CPA/ABV, CVA, MBA has received the 2010 Jeffrey R. Salins Report Writing Award from the National Association of Certified Valuation Analysts (NACVA).

Click here to read the rest of this release.

Prior issues are available in the E-Newsletter Archive of our Valuation & Litigation Advisory Services Resource Center. If you would like to subscribe to this free, monthly, business valuation and litigation support 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.