Demystifying Valuation, Economic Damages + Forensic Accounting

6 Steps to know when you want to sell your business

If you’re a business owner and preparing to sell soon, these six steps will prepare you for an orderly and well-orchestrated process: Identify your personal and business goals. For most business owners, much of their personal wealth is in their business. Therefore, it is important to integrate your personal and business goals. Start by speaking …

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Governing agreements and holding company valuation

One of the first items we ask for when engaged to value a holding company interest is the governing agreement of that entity. This could be either an Operating or Partnership Agreement (with all amendments). Sometimes we are asked why we need the governing agreement to prepare a valuation. In the valuation of holding company …

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Mediation and the CPA expert

The Merriam-Webster online dictionary describes the process of mediation as: “(T)he act or process of mediating; especially: intervention between conflicting parties to promote reconciliation, settlement, or compromise.” Mediation is also described by dictionary.thelaw.com, as using: “A third party, neutral facilitator who assists parties in conducting effective communication and negotiation in order to find an appropriate …

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New business: reasonable certainty test for lost profits

Several years ago, I wrote about whether a new or unestablished business can recover a claim for lost profits. Older case law precluded the recovery of lost profits for new businesses due to the remote or speculative nature of the damages. This was known as the “New Business Rule.” A review of the older case …

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What does forensic accounting mean anyway?

We hear the term forensic all the time, and it holds a special place in pop culture thanks to TV shows like the fictional CSI and the “real-life” Forensic Files. The news also inundates us with stories about legal proceedings involving forensic accountants, psychiatrists, pathologists, toxicologists and others. However, when pressed, most people don’t really …

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Succession planning v exit planning: what’s the difference?

For business owners preparing for the next chapter in the business cycle, the terminology used by consultants can be a little confusing. Most owners believe that succession planning and exit planning are the same, but they are not. We offer the following descriptions of each term to assist those of you who are looking to …

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ASA supports trustee, appraiser in ESOP litigation

I recently wrote an article about several cases being brought by the Department of Labor (DOL) against Employee Stock Ownership Plan (ESOP) trustees. The cases all related to the DOL’s claim that the ESOP trustees had breached their fiduciary duties by relying on appraisals prepared for the valuation of the ESOP owned stock. One such …

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Small business fraud: not so small, twice as costly

This past April, the Association of Certified Fraud Examiners (ACFE) released the 10th edition of its global study on occupational fraud, the Report to the Nations – 2018 Global Study on Occupational Fraud and Abuse (the “ACFE Report”). The ACFE Report summarizes statistics based on 2,690 cases that resulted in over $7 billion in damages. …

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Merger and acquisition activity and tax reform

One of the three major changes included in the Tax Cuts and Jobs Act of 2017 (TCJA) that impacts multinational companies (MNC) is the ability to repatriate cash from overseas. The TCJA makes it easier for MNCs to get cash earned abroad back to the United States. A sudden increase in cash on an MNC …

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Why CPAs who testify like QuickBooks

CPAs who perform litigation support and forensic accounting services are retained as expert witnesses to provide reports and to testify on their reports on such matters as: Determining income of mother or father from an owned business for child support or spousal maintenance purposes, Determining lost profits of a business in owner disputes, Determining the …

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