We saw large increases in the value of public companies during 2017 in anticipation of the new administration’s proposals to reduce federal regulations, promote growth policies and push for tax reduction. The Dow Jones Industrial Average and the NASDAQ both increased just over 20% during 2017 and the S&P 500 index increased by almost 16% …
The valuation of a business is prepared as of a certain date in time. This could be any date, often determined by the purpose of the valuation. A valuation prepared for estate tax purposes is as of the date of death. A valuation for divorce purposes is often the date of service. The valuation date …
When it comes to the valuation of non-controlling interests in pass-through entities (PTEs) such as a Subchapter S corporation, there have been ongoing disagreements between business valuators and the IRS. The issue is whether and to what extent to offset PTE earnings for income taxes (often termed “tax-affecting”). Doing so reduces the value under the …
My heart, as many others, goes out to the people of Houston and the surrounding cities and towns affected by Hurricane Harvey. I experienced the storm surge created by Hurricane Isabel in 2003. My home was within inches of flooding and my next door neighbor completely lost his home simply because the typography of his …
Recently, a number of clients have engaged us to value their business because they do not have a firm grasp of what their company is worth and they are considering selling their interest in the near future. After we performed the assignment and met with the client to discuss the value drivers of their business, …
There is a reason it is called exit planning – there are steps required for you to ultimately leave the company you have built. One-step is to understand who will be on the other side of the negotiation table in a potential transaction. In most cases, there are five types of buyers in the market …
According to Internal Revenue Code Section 6166, a personal representative (PR) may defer payment of federal estate tax if the decedent’s equity interest in a closely held business exceeds 35 percent of his adjusted gross estate. In order to be eligible for a Section 6166 election, the closely held business must qualify as an active …
Recently, this seems to be the number one question I receive from aging business owners that have begun to contemplate what to do next with their business. Business owners are beginning to realize they cannot work forever and are looking for options to liquidate their investment. So, what’s their business worth? What are a business …
“Tone at the Top” is an often used term when talking about corporate fraud and how to prevent it. Essentially “tone at the top” refers to the ethical and cultural atmosphere created in the workplace by leadership. If an organization’s leadership displays integrity, the employees are inclined to follow their lead. If however, employees believe …
I was approached by a prospective client a few years ago requiring forensic accounting services in connection with his divorce. The prospective client made it clear to me what his ultimate objective was. He told me, “I want you to review documents I’m going to show you and conclude with me that my wife stole …
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