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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Serie: Wiley Finance
- Sprache: Englisch
A comprehensive guide to the theory and application of valuation, along with useful models, tools, and tips for analysts
Financial Valuation: Applications and Models provides authoritative reference and practical guidance on the appropriate, defensible way to prepare and present business valuations. With contributions by 30 top experts in the field, this updated edition provides an essential resource for those seeking the most up-to-date methods, with a strong emphasis on applications and models. Coverage includes the latest approaches to the valuation of closely held businesses, nonpublic entities, intangibles, and other assets, with comprehensive discussion on valuation theory, a consensus view on application, and the tools to make it happen.
This 5th edition has been revised throughout, introducing new and extended coverage of essential topics like: S Corps, discounts for lack of marketability, cost of capital resources, cash flow methods, depositions and trials, and more. Packed with examples, checklists, and models to help navigate valuation projects, this book is an excellent practical tool for working professionals. It also provides hundreds of expert tips and best practices in clear, easy-to-follow language. The companion website provides access to extensive appendix materials, and the perspectives of valuation thought leaders add critical insight.
- Learn the art and science of estimating the value of businesses, including closely held businesses and nonpublic entities
- Determine the monetary value of intangible assets like goodwill, intellectual property, and brand recognition
- Update your knowledge with the latest valuation methods, approaches, and tools
- Use checklists, templates, models, and examples to make your valuations easier
Business valuation analysts, CPAs, appraisers, and attorneys—as well as anyone aspiring to those careers—will appreciate the comprehensive theory and thorough practical guidance in Financial Valuation: Applications and Models.
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Seitenzahl: 3139
Veröffentlichungsjahr: 2024
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Table of Contents
Cover
Table of Contents
Title Page
Copyright
About the Editor
About the Authors
Acknowledgments
Preface
CHAPTER 1: Introduction to Financial Valuation
WHO VALUES BUSINESSES?
PURPOSE OF A VALUATION
PROFESSIONAL VALUATION ORGANIZATIONS
STANDARDS OF VALUE
PREMISE OF VALUE
PRINCIPLES OF APPRAISAL PRACTICE
DATES
APPROACHES TO VALUE
VALUATION PROCEDURES
SUMMARY
ADDENDUM 1—VALUATION CHECKLIST/READY REFERENCE (REVENUE RULING 59-60)
ADDENDUM 2—2001
INTERNATIONAL GLOSSARY OF BUSINESS VALUATION TERMS
ADDENDUM 3—AICPA GLOSSARY OF ADDITIONAL TERMS, STATEMENTS ON STANDARDS FOR VALUATION SERVICES VS SECTION 100
ADDENDUM 4—2022
INTERNATIONAL VALUATION GLOSSARY—BUSINESS VALUATION
ADDENDUM 5—“THE BUSINESS VALUATION GLOSSARY ISSUE”
ENDNOTES
NOTES
CHAPTER 2: Standards of Value
INTRODUCTION
HOW THE STANDARD OF VALUE CAN AFFECT THE FINAL “NUMBER”
PREMISES OF VALUE
COMMON STANDARDS OF VALUE
COMMON OPERATIONAL PREMISES UNDERLYING THE STANDARD OF VALUE
APPLICATION OF SPECIFIC STANDARDS OF VALUE
FAIR VALUE IN SHAREHOLDER DISSENT AND OPPRESSION
STANDARD OF VALUE IN DIVORCE
FAIR VALUE IN FINANCIAL ACCOUNTING
MEASUREMENT
CONCLUSION
NOTES
CHAPTER 3: Research and Its Presentation
OBTAINING INTERNAL INFORMATION
EXTERNAL SOURCES OF DATA
RESEARCH TECHNIQUES AND PLANNING THE SEARCH
INFORMATION SOURCES: BUSINESS FINANCIAL DATABASES
ECONOMIC RESEARCH
SELECTED SOURCES OF ECONOMIC INFORMATION
INDUSTRY RESEARCH
SELECTED SOURCES OF INDUSTRY INFORMATION
GUIDELINE PUBLIC COMPANY AND GUIDELINE COMPANY TRANSACTIONS RESEARCH
PRESENTING RESEARCH IN A REPORT
COST OF CAPITAL RESEARCH
OTHER SOURCES OF INFORMATION
SUMMARY
NOTES
CHAPTER 4: Financial Statement and Company Risk Analysis
HISTORICAL FINANCIAL STATEMENT ANALYSIS
LENGTH OF FINANCIAL HISTORY TO BE USED
SPREADING FINANCIAL STATEMENTS IN COLUMNAR FORMAT
ADJUSTMENTS TO FINANCIAL STATEMENTS
NORMALIZATION OF HISTORICAL FINANCIAL STATEMENTS
UNUSUAL AND NONRECURRING ITEMS
NONOPERATING ITEMS
CHANGES IN ACCOUNTING PRINCIPLES
NONCONFORMANCE WITH GAAP
TAX-AFFECTING THE EARNINGS OF SUBCHAPTER S CORPORATIONS AND ADJUSTMENTS
DEGREE OF OWNERSHIP INTEREST
NORMALIZATION ADJUSTMENTS—ALE’S DISTRIBUTING COMPANY, INC.
COMMON SIZING NORMALIZED FINANCIAL STATEMENTS
RATIO ANALYSIS (QUANTITATIVE ANALYSIS)
COMPARATIVE ANALYSIS
RISK ANALYSIS (QUALITATIVE ANALYSIS)
MACROENVIRONMENTAL ANALYSIS
ADDENDUM 1—COMMONLY USED FINANCIAL RATIOS: APPLICATION TO ALE’S DISTRIBUTING
NOTES
CHAPTER 5: Income Approach
FUNDAMENTAL THEORY
CORE THEORY—“A FRACTION”
INCOME APPROACH METHODOLOGIES
NORMALIZATION PROCESS
ADJUSTMENTS FOR OWNERSHIP CHARACTERISTICS
ADJUSTMENTS FOR GAAP DEPARTURES AND EXTRAORDINARY, NONRECURRING, AND/OR UNUSUAL ITEMS
ADJUSTMENTS FOR NONOPERATING ASSETS AND LIABILITIES AND RELATED INCOME AND EXPENSES
ADJUSTMENTS FOR TAXES
ADJUSTMENTS FOR SYNERGIES FROM MERGERS AND ACQUISITIONS
DETERMINATION OF FUTURE BENEFIT STREAM (CASH FLOWS)
DEFINING THE BENEFIT STREAM
DEFINING NET CASH FLOW
USE OF HISTORICAL INFORMATION
THE CAPITALIZED CASH FLOW METHOD
THE DISCOUNTED CASH FLOW METHOD
TERMINAL VALUE
RELATIONSHIP OF DISCOUNTED CASH FLOW METHOD TO CAPITALIZED CASH FLOW METHOD
EXCESS CASH FLOW METHOD
BEST PRACTICES
CONCLUSION
ADDENDUM 1—APPLICATION OF THE DIRECT EQUITY METHOD (DEM) AND THE INVESTED CAPITAL METHOD (ICM)
ADDENDUM 2—DEALING WITH DEBT
ADDENDUM 3—BEST PRACTICES: THE TERMINAL YEAR OF A DISCOUNTED CASH FLOW MODEL
ADDENDUM 4—BEST PRACTICES: THE TERMINAL YEAR OF A DISCOUNTED CASH FLOW MODEL
NOTES
CHAPTER 6: Cost of Capital/Rates of Return
VALUE DRIVERS
RELATIONSHIP BETWEEN RISK AND RETURN
CHARACTERISTICS OF COST OF CAPITAL
THE COST OF EQUITY
RISK-FREE RATE (Rf)
EQUITY RISK PREMIUM (RP
m
OR ERP)
BETA
INDUSTRY RISK PREMIUM (IRP)
SIZE PREMIUM (RP
s
)
COMPANY-SPECIFIC RISK (RP
c
)
ISSUES IN COST OF CAPITAL
COST OF EQUITY EXAMPLE
IMPLIED RETURNS FROM MARKET DATA
WEIGHTED AVERAGE COST OF CAPITAL
THE COST OF DEBT
THE COST OF EQUITY
VENTURE CAPITAL RETURNS
ADDENDUM 1—BUSINESS VALUATION RESOURCES’
COST OF CAPITAL PROFESSIONAL
ADDENDUM 2—VPS “QUICK STUDY” SUMMARY OUTLINE NAVIGATING THE NAVIGATOR
1. COST OF CAPITAL OVERVIEW
3. BETA AND INDUSTRY RISK PREMIUM
4. RISK-FREE RATE AND EQUITY RISK PREMIUM
5. SIZE PREMIUM
6. COMPANY-SPECIFIC RISK PREMIUM
7. REAL ESTATE
8. TECHNICAL QUESTIONS ABOUT THE DATA
9. MISCELLANEOUS
10. HISTORICAL VERSIONS OF THE VALUATION HANDBOOK—U.S. GUIDE TO COST OF CAPITAL (2014–2018)
11. HOW TO
NOTES
CHAPTER 7: International Cost of Capital
BACKGROUND
ESTIMATING THE COST OF EQUITY
ESTIMATING THE COST OF DEBT
ANALYSIS OF MULTINATIONAL CORPORATIONS
CASE STUDY
TECHNIQUE FOR CONSIDERING A LARGE PORTFOLIO OF COUNTRIES
CONCLUSION
NOTES
CHAPTER 8: Market Approach
OVERVIEW
LEVEL OF VALUE
ADVANTAGES AND DISADVANTAGES OF THE MARKET APPROACH
UNDERSTANDING THE SUBJECT COMPANY
FINDING GUIDELINE COMPANIES
SOURCES OF TRANSACTION DATA
THE DIRECT MARKET DATA METHOD
GUIDELINE COMPANY TRANSACTIONS METHOD
SELECTING GUIDELINE PUBLIC COMPANIES
BASIC FINANCIAL INDICATORS
COMPARING GUIDELINE AND SUBJECT COMPANY DATA
ADJUSTMENTS TO THE GUIDELINE AND SUBJECT COMPANIES
SELECTING GUIDELINE COMPANIES IN SUMMARY
CALCULATING STANDARD PRICING MULTIPLES
EQUITY VERSUS INVESTED CAPITAL
FINANCIAL STATEMENT MEASURES
COMPUTING MULTIPLES
MATCHING PRICE TO PARAMETER
DISPERSION OF PRICING MULTIPLES
APPLYING THE VALUATION MULTIPLES
ADJUSTING PRICING MULTIPLES FOR DIFFERENCES IN GROWTH
ADJUSTING THE GUIDELINE MULTIPLES FOR SIZE
SUMMARY
NOTES
CHAPTER 9: Asset Approach
THEORY
APPLICATION
PREMISE OF VALUE
CONTROL VERSUS MINORITY
BUILT-IN GAINS TAXES
GENERAL STEPS IN THE ASSET APPROACH
CASE STUDY
BEST PRACTICES
ADDENDUM 1—UNDERSTANDING REAL ESTATE APPRAISALS
ADDENDUM 2—UNDERSTANDING MACHINERY AND EQUIPMENT APPRAISALS
NOTES
CHAPTER 10: Valuation Discounts and Premiums
LEVELS OF VALUE
LIQUIDITY VERSUS MARKETABILITY
ENTITY-LEVEL VERSUS SHAREHOLDER-LEVEL DISCOUNTS
CONTROVERSIAL ISSUES
CONTROLLING VERSUS NONCONTROLLING INTERESTS
CALCULATING A DISCOUNT FOR LACK OF CONTROL
CONTROL PREMIUMS
CONTROL AND THE MARKET APPROACH
CONTROL AND THE INCOME APPROACH
DISCOUNTS FOR LACK OF MARKETABILITY
DLOM ON A CONTROLLING INTEREST
EMPIRICAL EVIDENCE OF MARKETABILITY DISCOUNTS
APPLYING STUDY DATA
QUANTITATIVE TOOLS
FACTORS INFLUENCING MARKETABILITY
OTHER DISCOUNTS
PREMIUMS ACCORDED VOTING VERSUS NONVOTING STOCK
SUMMARY
NOTES
CHAPTER 11: Addendum—Sample Valuation Report
HISTORY AND NATURE OF BUSINESS
GENERAL ECONOMIC AND INDUSTRY OUTLOOK
BOOK VALUE AND FINANCIAL POSITION
PROJECTIONS
APPROACHES TO VALUE
INCOME APPROACH
COST OF CAPITAL
MARKET APPROACH
GUIDELINE PUBLIC COMPANY METHOD
GUIDELINE COMPANY TRANSACTIONS METHOD
RECONCILIATION OF VALUATION METHODS
CONCLUSION OF VALUE
APPENDIX A—ASSUMPTIONS AND LIMITING CONDITIONS
APPENDIX B—VALUATION REPRESENTATION/CERTIFICATION
APPENDIX C—PROFESSIONAL QUALIFICATIONS OF THE APPRAISER
APPENDIX D—OTHER SOURCES CONSULTED
APPENDIX E—EXHIBITS
APPENDIX F—ADDITIONAL INFORMATION FROM MERCER CAPITAL’S NATIONAL ECONOMIC REVIEW
ENDNOTES
NOTES
CHAPTER 12: Business Valuation Standards
HISTORY OF VALUATION STANDARDS
GOVERNMENT ACTION
ORGANIZATION OF THE USPAP STANDARDS
USPAP BUSINESS VALUATION STANDARDS (2020–2021—EXTENDED TO DECEMBER 31, 2023)
OTHER BUSINESS VALUATION STANDARDS AND CREDENTIALS
SUMMARY
ADDENDUM 1—A SUMMARY OF THE AICPA’S BV STANDARDS
NOTES
CHAPTER 13: Valuation of Pass-Through Entities
INTRODUCTION
BACKGROUND
STANDARD OF VALUE
CONTROLLING INTERESTS IN PASS-THROUGH ENTITIES
APPLICABLE TAX RATES
NONCONTROLLING INTERESTS IN PASS-THROUGH ENTITIES
TREHARNE MODEL
VAN VLEET MODEL
THE S CORPORATION ECONOMIC ADJUSTMENT
THE S CORPORATION EQUITY ADJUSTMENT MULTIPLE
SUMMARY: NONCONTROLLING INTEREST IN PASS-THROUGH ENTITY THEORY
BIBLIOGRAPHY
OLDER SOURCES OF INFORMATION
NOTES
CHAPTER 14: Estate, Gift, and Income Tax Valuations
SELECTED INTERNAL REVENUE CODE PROVISIONS
SELECTED TREASURY REGULATIONS
SELECTED REVENUE RULINGS
VALUATIONS FOR INCOME TAXES
NOTES
CHAPTER 15: Valuation of Family Limited Partnerships
APPLICATIONS
TAX ADVANTAGES
FORMATION
OTHER CHARACTERISTICS
IMPORTANCE OF STATE LAW AND PROPERTY RIGHTS
IMPROPER FORMATION CAN CREATE PROBLEMS FOR PARTNERS
VALUATION OF FAMILY LIMITED PARTNERSHIP INTERESTS
PRELIMINARY CONSIDERATIONS
TAX CODE, REGULATIONS, AND OFFICIAL GUIDANCE
CHARACTERISTICS THAT AFFECT VALUE
OTHER FACTORS TO CONSIDER
COMPONENTS OF THE PARTNERSHIP
RESEARCH
VALUATION APPROACHES AND ADJUSTMENTS
CASE STUDY
COURT CASES
NOTES
CHAPTER 16: Summary of Tax Court Case Valuation Issues
TAX COURT DECISIONS
NOTES
CHAPTER 17: Shareholder Disputes
HISTORY OF SHAREHOLDER DISPUTES
CAUSES OF ACTION
STANDARD OF VALUE
VALUATION DATE
ENTIRE FAIRNESS
VALUATION METHODOLOGY
VALUATION ADJUSTMENTS
SOME RELEVANT COURT CASES
RECENT DELAWARE DECISIONS
COURT CASE CAVEATS
CONCLUSION
NOTES
CHAPTER 18: Employee Stock Ownership Plans
INTRODUCTION
PURPOSES
REQUIREMENTS
REGULATORY ENVIRONMENT
TAX CONSIDERATIONS
NEED FOR VALUATION SERVICES
ADEQUATE CONSIDERATION AND STANDARD OF VALUE
FEASIBILITY OF FORMATION
ESOP SHARE OWNERSHIP CHARACTERISTICS
ONGOING OPERATIONS
ACCOUNTING STANDARDS FOR ESOP COMPANIES WITH ACQUISITION DEBT
ESOP VALUATION ENGAGEMENTS
DEMAND FOR APPRAISAL REVIEW SERVICES
ADDITIONAL INFORMATION
NOTES
CHAPTER 19: Valuation in the Divorce Setting
STANDARDS OF VALUE
PREMISE OF VALUE
GOODWILL
STATE INTERPRETATIONS ON INCLUSION OF GOODWILL IN THE MARITAL ESTATE
PERSONAL VERSUS ENTERPRISE GOODWILL
ALLOCATION OF GOODWILL AS PERSONAL OR ENTERPRISE
APPLYING THE FACTORS TO ASSESS GOODWILL
ROLE OF NONCOMPETE AGREEMENTS IN DETERMINING PERSONAL VERSUS ENTERPRISE GOODWILL
TRIFURCATION OF GOODWILL AND THE CONCEPT OF TRADEABLE PERSONAL GOODWILL
PERSONAL GOODWILL IN COMMERCIAL BUSINESSES
DOUBLE DIPPING IN DIVORCE CASES
VALUATION OF THE S CORPORATION AND OTHER PASS-THROUGH ENTITIES
RESTRICTIONS ON DATA
RANGE VERSUS SPECIFICITY
PROFESSIONAL STANDARDS
VALUATION METHODOLOGY AND THE APPLICATION OF DISCOUNTS
LIQUIDITY MYTH IN PASS-THROUGH ENTITIES
SUMMARY
NOTES
CHAPTER 20: Valuation Issues in Small Businesses
COMMON CHARACTERISTICS
FINANCIAL STATEMENT ADJUSTMENTS
QUALITATIVE FACTORS AFFECTING VALUE
VALUATION METHODS
REASONABLENESS TESTS
SUMMARY
NOTES
CHAPTER 21: Valuation Issues in Professional Practices
TYPES OF PRACTICES
PURPOSE OF VALUATION
PROFESSIONAL GOODWILL AND PRACTICE GOODWILL
SELECTED CASE LAW FOR MARITAL DISSOLUTION
FACTORS AFFECTING VALUE
FINANCIAL STATEMENT ADJUSTMENTS
VALUATION METHODS
SUMMARY
NOTES
CHAPTER 22: Reasonable Compensation
PURPOSES FOR ANALYSIS
TYPES OF COMPENSATION
ASSESSING COMPENSATION
METHODS OF CALCULATING REASONABLE COMPENSATION
DIVORCE AND THE “DOUBLE DIP”
PERSONAL GOODWILL
REASONABLE COMPENSATION JOB AID FOR IRS VALUATION PROFESSIONALS
CONCLUSION
NOTES
CHAPTER 23: The Valuator as Expert Witness
INTRODUCTION
PRE-ENGAGEMENT CONSIDERATIONS
UNITED STATES REQUIREMENTS AND PROCEDURES APPLICABLE TO EXPERT WITNESSES
DAUBERT
MOTION
THE IKARIAN REEFER
CANADIAN REQUIREMENTS APPLICABLE TO EXPERT WITNESSES
“RULES” FOR THE TESTIFYING EXPERT WHEN ON THE WITNESS STAND
CONCLUSION
NOTES
CHAPTER 24: Fair Value Measurement and theValuation of Intangible Assets
INTRODUCTION
NATURE OF INTANGIBLE ASSETS
FAIR VALUE STANDARDS AND GUIDANCE
FAIR VALUE MEASUREMENT
BUSINESS COMBINATIONS
INTANGIBLES: RISK AND RETURN
VALUATION APPROACHES
COST APPROACH
MARKET APPROACH
INCOME APPROACH
AMORTIZATION BENEFIT
IN-PROCESS RESEARCH AND DEVELOPMENT
GOODWILL
FINANCIAL REPORTING DISCLOSURES
STATEMENTS ON STANDARDS FOR VALUATION SERVICES VS SECTION 100
CASE STUDY: DETERMINING THE VALUE OF GOODWILL AND OTHER INTANGIBLE ASSETS IN A BUSINESS COMBINATION
NOTES
CHAPTER 25: Marketing, Managing, and Making Money in a Valuation Services Group
PURPOSE AND OVERVIEW
CHAPTER 26: Business Damages
GENERAL CONSIDERATIONS IN DAMAGES CALCULATIONS
LEGAL PRINCIPLES GOVERNING DAMAGES
MEASUREMENT OF DAMAGES
CAN LOST PROFITS EXCEED THE FAIR MARKET VALUE OF THE BUSINESS?
CONSIDERATIONS IN INTELLECTUAL PROPERTY DAMAGES
CONSIDERATIONS IN SECURITIES CLASS ACTION LITIGATION
STANDARDS
CONCLUSION
NOTES
CHAPTER 27: Other Valuation Service Areas
A: VALUATION FOR PUBLIC COMPANIES AND/OR FINANCIAL REPORTING
B: VALUATION OF DEBT
C: VALUATION OF PREFERRED STOCK
D: RESTRICTED STOCK VALUATION
E: VALUATION ISSUES IN EARLY-STAGE COMPANIES
F: STOCK OPTIONS AND OTHER SHARE-BASED COMPENSATION
G: REAL OPTION VALUATIONS
H: MAXIMIZING SHAREHOLDER VALUE
NOTES
CHAPTER 28: Valuation of HealthcareService Businesses
BACKGROUND
INDUSTRY FACTORS
STANDARD OF VALUE
CONSIDERATIONS FOR VALUING HEALTHCARE ENTITIES
VALUATION PROCESS
CONTROL PREMIUMS AND MINORITY DISCOUNTS
DISCOUNTS FOR LACK OF MARKETABILITY
VALUATION ISSUES FOR SPECIFIC HEALTHCARE INDUSTRY NICHES
PUBLIC AND PRIVATE HEALTHCARE SERVICES COMPANIES BY NICHE
NOTES
CHAPTER 29: Determination of Compensation in the Healthcare Industry
NEED FOR COMPENSATION ASSIGNMENTS
REGULATORY GUIDANCE
APPLICABLE VALUATION STANDARDS
COMPENSATION ELEMENTS
SOURCES OF DATA
DOCUMENTATION
CONCLUSION
NOTES
CHAPTER 30: Special Industry Valuations
INTRODUCTION
CONSTRUCTION
OIL AND GAS EXPLORATION AND PRODUCTION VALUATIONS
RESTAURANTS
BARS AND NIGHTCLUBS
ADDENDUM 1—AN INTERVIEW WITH A BUSINESS BROKER-VALUATOR
NOTES
CHAPTER 31: Buy-Sell Agreements
INTRODUCTION
OVERVIEW OF BUY-SELL AGREEMENTS
KEY TERMS AND PROVISIONS
REVIEWING A BUY-SELL AGREEMENT
THE VALUATION PROCESS
IMPACTS ON VALUE
ESTATE TAX CONSIDERATIONS
CONSIDERATIONS IN DIVORCE
CONCLUSION
NOTES
CHAPTER 32: Valuation Views and Controversial Issues: an Illustration
UNDERSTANDING WITH THE CLIENT AND SCOPE OF WORK
EXECUTIVE SUMMARY
HISTORY AND NATURE OF BUSINESS
GENERAL ECONOMIC AND INDUSTRY OUTLOOK
BOOK VALUE AND FINANCIAL POSITION
PROJECTIONS
APPROACHES TO VALUE
INCOME APPROACH
COST OF CAPITAL
MARKET APPROACH
GUIDELINE PUBLIC COMPANY METHOD
GUIDELINE COMPANY TRANSACTIONS METHOD
RECONCILIATION OF VALUATION METHODS
CONCLUSION OF VALUE
APPENDIX A—ASSUMPTIONS AND LIMITING CONDITIONS
APPENDIX B—VALUATION REPRESENTATION/CERTIFICATION
APPENDIX C—PROFESSIONAL QUALIFICATIONS OF THE APPRAISER
APPENDIX D—OTHER SOURCES CONSULTED
APPENDIX E—EXHIBITS
APPENDIX F—ADDITIONAL INFORMATION FROM MERCER CAPITAL’S NATIONAL ECONOMIC REVIEW
ENDNOTES
NOTES
About the Website
ADDENDUMS AND ONLINE CHAPTERS
Index
End User License Agreement
List of Tables
Chapter 5
EXHIBIT 5.1 Taxes and Value
EXHIBIT 5.2 Applying After-Tax Cap Rate to Pre-Tax Cash Flow
EXHIBIT 5.5 Basic DCF Formula
EXHIBIT 5.6 Cash Flow and Growth
EXHIBIT 5.7 DCF with Terminal Year
EXHIBIT 5.9 Midyear Convention with Partial Year Example
EXHIBIT 5.10 Midyear Convention Model Compared to a Monthly Model
EXHIBIT 5.11 Midyear Convention DCF Model
EXHIBIT 5.12 Mathematical Proof Midyear Convention Terminal Year Factor Assu...
EXHIBIT 5.15 Another View (End-of-Year Convention Example Calculation)
EXHIBIT 5.16 Multi-Stage Growth Projections
EXHIBIT 5.17 Formula for Multi-Stage Models
EXHIBIT 5.18 DCF Value (Invested Capital Method)
EXHIBIT 5.19 Gordon Growth Model (GGM) for Terminal Year
EXHIBIT 5.20 H Model
EXHIBIT 5.21 Advanced Growth Model
EXHIBIT 5.22 Relationship of DCF to CCF
EXHIBIT 5.23 Procedures for Excess Cash Flow Method–Invested Capital
EXHIBIT 5.24 Steps for Excess Cash Flow Method
EXHIBIT 5.25 Rate for Net Tangible Assets (Illustration Only)
EXHIBIT 5.26 Determine the Cash Flows Attributable to Net Tangible Assets
EXHIBIT 5.27 Calculate Cash Flows Attributable to Intangible Assets
EXHIBIT 5.29 Determine the Fair Market Value of the Intangible Assets
EXHIBIT 5.30 Calculate Invested Capital Value
EXHIBIT 5.31 Calculate Value of Equity
EXHIBIT 5.32 Calculate Implied Rate of Return
EXHIBIT 5.34A Presentation of Both Direct Equity and Invested Capital Method...
EXHIBIT 5.34B Presentation of Financial Information for ABC Corp.
EXHIBIT 5.34C Presentation of the Iteration Process Required to Equalize Wei...
EXHIBIT 5.34D Iteration Process Required for ICM-MCAPM
EXHIBIT 5.35 Comparison of CF-Eq to CF-IC
EXHIBIT 5.36 AGM and GGM
EXHIBIT 5.38 Mid-Year Convention DCF Model
Chapter 6
EXHIBIT 6.1 Cost of Capital Benchmark Data: December 31, 2019, 2020, 2021, a...
EXHIBIT 6.3 Risk-Free Rate: 20-Year Treasury “Spot” vs.
Cost of Capital Navi
...
EXHIBIT 6.4 Unconditional Equity Risk Premium Options,
Cost of Capital Navig
...
EXHIBIT 6.5
Cost of Capital Navigator
Industry Risk Premium Data Example
EXHIBIT 6.6 Company-Specific Risk: Component Detail Method
EXHIBIT 6.7 Company-Specific Risk: Component Observation Method
EXHIBIT 6.8 Company-Specific Risk: Component Summary Method
EXHIBIT 6.12 Example Application of Risk Premium Report Data
EXHIBIT 6.13 Build-Up Model Using Historical Unadjusted Data
EXHIBIT 6.14 MCAPM Using Historical Unadjusted Data
EXHIBIT 6.15 Build-Up Model and MCAPM Using Adjusted Data (Normalized R
f
and...
EXHIBIT 6.16 Relationship between the P/E Multiple and the Earnings Cap Rate...
EXHIBIT 6.17 Relationship between the Earnings Cap Rate and the Discount Rat...
EXHIBIT 6.18 Components of Both Risk and Growth
EXHIBIT 6.19 Example of WACC Formula in Tabular Format
EXHIBIT 6.20 Venture Capital Required Rates of Return
EXHIBIT 6.21 Ranges of Discount Rates by Stage of Investment, QED Venture Ca...
EXHIBIT 6.22 2023 Pepperdine Private Capital Markets Report, Selected Survey...
EXHIBIT 6.23 Build-Up and MCAPM Using Business Valuation Resources’
Cost of
...
EXHIBIT 6.24 Comparison of Estimated ERPs between Kroll’s
Cost of Capital Na
...
EXHIBIT 6.25 Comparison of Kroll’s
Cost of Capital Navigator
to Business Val...
Chapter 7
EXHIBIT 7.1 OECD Inflation Forecast
EXHIBIT 7.2 Calculation of Relative Equity Volatility
EXHIBIT 7.6 Example Weighted Average CCRM and Country Yield Spread Model by ...
Chapter 8
EXHIBIT 8.1 Presentation of Standard Financial Indicators
EXHIBIT 8.2 Pricing Multiples
EXHIBIT 8.3 Equity Values ($ Millions)
EXHIBIT 8.4 Blended Perpetual Growth Rates
Chapter 9
EXHIBIT 9.1 Summary of Some Court Cases on Built-In Gains Taxes
EXHIBIT 9.2 ABC Holding Company, Inc., Asset-Based Approach, as of December ...
EXHIBIT 9.3 ABC Holding Company, Inc., Marketable Securities, as of December...
EXHIBIT 9.4 ABC Holding Company, Inc., Valuation of Debt, as of December 31,...
EXHIBIT 9.5 ABC Holding Company, Inc., Calculation of Built-In Gain Liabilit...
Chapter 12
EXHIBIT 12.1 Valuation Analyst Representation
EXHIBIT 12.2 Conclusion Statements
Chapter 13
EXHIBIT 13.1 Summary of Prominent Tax Court Cases on Pass-Through Entity Tax...
EXHIBIT 13.2 Tax Court Imputed Tax Rate for Delaware Open MRI Radiology Asso...
EXHIBIT 13.3 Retained Cash Flow
EXHIBIT 13.4 Cash to Investor
EXHIBIT 13.5 Valuation Conclusions Summary: S Corporation Minority Interests...
EXHIBIT 13.6 Net Economic Benefits to Shareholders
EXHIBIT 13.7 Net Economic Benefit to C Corporation Shareholders (NEB
c
)
EXHIBIT 13.8 Net Economic Benefit to S Corporation Shareholders (NEB
S
)
EXHIBIT 13.9 S Corporation Economic Adjustment (SEA)
EXHIBIT 13.10 The SEAM
EXHIBIT 13.11 Example Calculations of the SEAM
EXHIBIT 13.12 Example of SEAM Applied to C Corporation Value of Equity
Chapter 17
EXHIBIT 17.1 Differences between Fair Market Value and Fair Value
Chapter 22
EXHIBIT 22.1 Potential Forms of Compensation
EXHIBIT 22.2 Multi-Factor Test
EXHIBIT 22.3 Example of an Independent Investor Test
EXHIBIT 22.4 Reasonable Replacement Compensation Checklist
EXHIBIT 22.5 Example of a Cost Approach Calculation of Compensation
Chapter 24
EXHIBIT 24.1 Examples of ASC 805 Intangible Assets by Class
EXHIBIT 24.2 Application of Adjustments for Obsolescence
EXHIBIT 24.3 Revenues by Trade Name
EXHIBIT 24.4 Contributory Assets and Returns
EXHIBIT 24.5 Consideration
EXHIBIT 24.6 Adjusted Balance Sheet
EXHIBIT 24.8 Fair Value Balance Sheet—Total Assets and Total Liabilities and...
EXHIBIT 24.9 Fair Value Balance Sheet—Net Assets and Total Invested Capital...
EXHIBIT 24.10 Acquiree: Business Enterprise Value—Assumptions as of December...
EXHIBIT 24.11 Acquiree: Business Enterprise Value—Discounted Cash Flow as of...
EXHIBIT 24.12 Fair Value of Tangible Assets as of December 31, 2025
EXHIBIT 24.13 Valuation of Acquired Internally Developed Software (as of Dec...
EXHIBIT 24.14 Alternative Method to Valuing Internally Developed Software
EXHIBIT 24.15 Valuation of Assembled Workforce (as of December 31, 2025)
EXHIBIT 24.16 Valuation of Trade Name (as of December 31, 2025)
EXHIBIT 24.17 Amortization Benefit—the Long Way
EXHIBIT 24.18 Valuation of Noncompete Agreement (as of December 31, 2025)
EXHIBIT 24.19 Scenario 1: Net Cash Flows with Noncompete (as of December 31,...
EXHIBIT 24.20 Scenario 2: Net Cash Flows without Noncompete (as of December ...
EXHIBIT 24.21 Calculation of Existing Technology (as of December 31, 2025)
EXHIBIT 24.22 Valuation of IPR&D (as of December 31, 2025)
EXHIBIT 24.23 Valuation of Customer Relationships (as of December 31, 2025)...
EXHIBIT 24.24 Contributory Asset Returns (as of December 31, 2025)
EXHIBIT 24.25 Example WARA for ABC Company
EXHIBIT 24.26 Summary of Conclusions (as of December 31, 2025)
Chapter 26
EXHIBIT 26.2 Common Differences between Lost Profits Calculations and Busine...
EXHIBIT 26.6 Effect of Discount Rates on Lost Profits*
EXHIBIT 26.7 XYZ Inc.: Expected Future Income But For the Defendant’s Action...
EXHIBIT 26.8 XYZ Inc.: Calculation of Damages for Future Lost Profits
EXHIBIT 26.9 XYZ Inc.: Reinvestment of Damages Award Net of Taxes
EXHIBIT 26.10 XYZ Inc.: But-For Net Income Plus Accumulated Earnings through...
Chapter 28
EXHIBIT 28.2 Annual Expenditures by Healthcare Service Area
EXHIBIT 28.3 Physician Reliance Evaluation
EXHIBIT 28.4 Healthcare Entities by Niche
Chapter 29
EXHIBIT 29.1 Example: Medicare Reimbursement by wRVU*
EXHIBIT 29.2 Example: wRVU Productivity Level and Compensation*
Chapter 30
EXHIBIT 30.1 Granite Construction Incorporated Consolidated Balance Sheets (...
EXHIBIT 30.2 Granite Construction Incorporated Consolidated Balance Sheets (...
EXHIBIT 30.3 Rock Corporation Consolidated Balance Sheets (Retentions)
EXHIBIT 30.4 Completed Contracts (for Year Ended December 31, 20X3)
EXHIBIT 30.5 Contracts in Progress (for Year Ended December 31, 2023)
EXHIBIT 30.6 Balance Sheet Assessment
Chapter 31
EXHIBIT 31.2 Gab Riel, Inc. Selected Financial Results
EXHIBIT 31.3 Calculation of Value—Formula Stipulated in Agreement
EXHIBIT 31.4 Fair Market Value
EXHIBIT 31.5 BCC Repurchase Liability
List of Illustrations
Chapter 1
EXHIBIT 1 2001
International Glossary
EXHIBIT 2 2022
International Glossary
EXHIBIT 3 2001/2022
International Glossary
EXHIBIT 4 Six-Glossary Comparison
EXHIBIT 7 2022 IVS Glossary
EXHIBIT 8 2022 RICS Glossary of Technical Terms
EXHIBIT 9 Uniform Standards of Professional Appraisal Practice (USPAP)
EXHIBIT 10 AICPA SSVS VS Section 100 – Glossary of Additional Terms
EXHIBIT 11 Six Glossaries—Overlap Comparisons
Chapter 4
EXHIBIT 4.1 Ale’s Distributing Company, Inc.—Historical Balance Sheets
EXHIBIT 4.2 Ale’s Distributing Company, Inc.—Historical Income Statements
EXHIBIT 4.3 Net Income Comparison—C Corp. vs. S Corp. (illustration only)
EXHIBIT 4.4 Ale’s Distributing Company, Inc.—Balance Sheet Normalization Adj...
EXHIBIT 4.5 Ale’s Distributing Company, Inc.—Balance Sheet Normalization Adj...
EXHIBIT 4.6 Ale’s Distributing Company, Inc.—Income Statement Normalization ...
EXHIBIT 4.7 Ale’s Distributing Company, Inc.—Normalized Historical Balance S...
EXHIBIT 4.8 Ale’s Distributing Company, Inc.—Normalized Historical Balance S...
EXHIBIT 4.9 Ale’s Distributing Company, Inc.—Normalized Historical Income St...
EXHIBIT 4.10 Ale’s Distributing Company, Inc.—Normalized Historical Balance ...
EXHIBIT 4.11 Ale’s Distributing Company, Inc.—Normalized Historical Balance ...
EXHIBIT 4.12 Ale’s Distributing Company, Inc.—Normalized Historical Income S...
EXHIBIT 4.13 Ale’s Distributing Company, Inc.—Comparative Ratio Analysis (Ra...
EXHIBIT 4.14 Ale’s Distributing Company, Inc.—Comparative Ratio Analysis (Ra...
EXHIBIT 4.15 Ale’s Distributing Company, Inc.—Comparative Ratio Analysis (Ra...
EXHIBIT 4.16 Ale’s Distributing Company, Inc.—Comparative Balance Sheets (Fi...
EXHIBIT 4.17 Ale’s Distributing Company, Inc.—Comparative Balance Sheets (Fi...
EXHIBIT 4.18 Ale’s Distributing Company, Inc.—Comparative Income Statements...
Chapter 5
EXHIBIT 5.3 Four Types of Analyses of Income Approach
EXHIBIT 5.4 Expected Cash Flow
EXHIBIT 5.8 End-of-Year Convention
EXHIBIT 5.13 Illustration of Specific Valuation Date
EXHIBIT 5.14 Schematic View for Year 2025 (End-of-Year Convention Example)
EXHIBIT 5.28 Determine the Rate of Return for Intangible Assets
EXHIBIT 5.33 Ratios of Debt and Equity to Total Invested Capital and Equity ...
EXHIBIT 5.34E Iteration Process for Perpetual Relationship of Computed WACC,...
EXHIBIT 5.37 Decision Tree
Chapter 6
EXHIBIT 6.2 Nominal Rate on 20-Year Treasury Constant Maturity at End of Cal...
EXHIBIT 6.9 Analyzing Company-Specific Risk 1
EXHIBIT 6.10 Analyzing Company-Specific Risk 2
EXHIBIT 6.11 Analyzing Company-Specific Risk 3
Chapter 7
EXHIBIT 7.3 Unhedged versus Hedged Return Volatilities Across All Currencies...
EXHIBIT 7.4 Hedged U.K. Equities Returns
EXHIBIT 7.5 Currency Return Contribution for U.S.-Based Investors in Interna...
Chapter 9
EXHIBIT 9.6 Present Worth of Future Benefits of Ownership
Chapter 10
EXHIBIT 10.1 Levels of Value (Old View)
EXHIBIT 10.2 Levels of Value (Newer View)
EXHIBIT 10.3 Levels of Value (Newest View)
EXHIBIT 10.4 Level of Value by Valuation Approach
EXHIBIT 10.5 Levels of Ownership
EXHIBIT 10.6 Factors Affecting a Discount for a Block of Greater than 50%
EXHIBIT 10.7 Factors Affecting a Discount for a Block of Less than 50%
EXHIBIT 10.8 Effects of Ownership Interests
EXHIBIT 10.9 Differences between the
Factset Mergerstat/BVR Control Premium
...
EXHIBIT 10.10 Factors Affecting Marketability
EXHIBIT 10.11 Private Company Discounts for Acquisition of Closely Held Comp...
EXHIBIT 10.12 Discounts on Multiples of Private Company Transactions Compare...
EXHIBIT 10.13 Kooli Study—Private Company Discounts
EXHIBIT 10.14 Summary of Pre-IPO Studies
EXHIBIT 10.15 Summary of the Emory Studies
EXHIBIT 10.16 Summary of the Emory Studies (adjusted 10/10/02)
EXHIBIT 10.17 Lack of Marketability Discount
EXHIBIT 10.18 Analysis of Transactions Occurring in Consulting Industry Guid...
EXHIBIT 10.19 Summary of Historical Changes to Rule 144
EXHIBIT 10.20 Summary of Restricted Stock Studies
EXHIBIT 10.21 Management Planning, Inc., Restricted Stock Study—Summary of T...
EXHIBIT 10.22 Management Planning, Inc., Restricted Stock Study—Factors with...
EXHIBIT 10.23 Management Planning, Inc., Restricted Stock Study—Factors with...
EXHIBIT 10.24 Comparison of Two Sets of Assumptions
EXHIBIT 10.25 DLOM Adjustment Example (illustration purposes only)
EXHIBIT 10.26 Summary of Analysis of Premiums on Voting versus Nonvoting Pub...
EXHIBIT 10.27 Price Differentials between Voting and Nonvoting Stock
Chapter 11
EXHIBIT 11.1 Executive Management
EXHIBIT 11.2 Ownership
EXHIBIT 11.3 Comparative Income Statement
EXHIBIT 11.4 Comparative Balance Sheet
EXHIBIT 11.5 Adjusted Comparative Income Statement
EXHIBIT 11.6 Adjusted Ratio Analysis
EXHIBIT 11.7 Management’s Projections
EXHIBIT 11.8 Capitalized Cash Flows to Invested Capital Method (Illustration...
EXHIBIT 11.9 Debt-Free Working Capital (DFWC)—Benchmark Data Analysis
EXHIBIT 11.10 Debt-Free Working Capital (DFWC) StatisticsSource: Guideline...
EXHIBIT 11.11 Discounted Cash Flow to Invested Capital Method
EXHIBIT 11.12 Discounted Cash Flow Method: Calculation of Incremental Workin...
EXHIBIT 11.13 Discounted Cash Flow Method: Calculation of Depreciation Overh...
EXHIBIT 11.14 Cost of Equity
EXHIBIT 11.15 Comparison to Historical Equity Risk Premiums by Characteristi...
EXHIBIT 11.16 Comparison to Historical Equity Risk Premiums Ranked by Risk M...
EXHIBIT 11.17 Industry Beta Analysis
EXHIBIT 11.18 Weighted Average Cost of Capital
EXHIBIT 11.19 Guideline Public Company Method: Ranking of Market Multiples
EXHIBIT 11.20 Guideline Public Company Method: Comparative Financial Analysi...
EXHIBIT 11.21 Guideline Public Company Method: Detail by Company
EXHIBIT 11.22 Guideline Public Company Method: Summary
EXHIBIT 11.23 Guideline Company Transactions Method: Detail
EXHIBIT 11.24 Guideline Company Transactions Method: Summary
EXHIBIT 11.25 Summary of Findings
Chapter 15
EXHIBIT 15.1 ABC FLP Ownership Structure
EXHIBIT 15.2 ABC FLP Organization Structure
EXHIBIT 15.3 ABC FLP Cost/Asset Approach
EXHIBIT 15.4 Stout Restricted Stock Study Database Search
EXHIBIT 15.5 Reconciliation of Discounts
EXHIBIT 15.6 FMV of Limited Partnership Interest
Chapter 19
EXHIBIT 19.1 Three Parts of Goodwill
Chapter 21
EXHIBIT 21.1 Professional Practice Assets, Returns, and Income (Illustration...
Chapter 24
EXHIBIT 24.7 General Formula Based on Fair Values
Chapter 26
EXHIBIT 26.1 Types of Remedies
EXHIBIT 26.3 Temporary Impairment
EXHIBIT 26.4 Immediate Destruction of Business
EXHIBIT 26.5 Slow Death of Business
Chapter 27
EXHIBIT 27.1 Valuation Approaches/Methodologies
Chapter 28
EXHIBIT 28.1 Glossary of Terms
Chapter 30
EXHIBIT 30.7 The Oil and Gas Value Chain
EXHIBIT 30.8 Categories of Reserves
Chapter 31
EXHIBIT 31.1 Levels of Value (Newest View)
Chapter 32
EXHIBIT 32.1 Executive Management
EXHIBIT 32.2 Ownership
EXHIBIT 32.3 Comparative Income Statement
EXHIBIT 32.4 Comparative Balance Sheet
EXHIBIT 32.5 Adjusted Comparative Income Statement
EXHIBIT 32.6 Adjusted Ratio Analysis
EXHIBIT 32.7 Management’s Projections
EXHIBIT 32.8 Management’s Projections
EXHIBIT 32.9 Debt-Free Working Capital (DFWC)—Benchmark Data Analysis
EXHIBIT 32.10 Debt-Free Working Capital (DFWC) Statistics
EXHIBIT 32.11 Discounted Cash Flow to Invested Capital Method
EXHIBIT 32.12 Discounted Cash Flow Method: Calculation of Incremental Workin...
EXHIBIT 32.13 Discounted Cash Flow Method: Calculation of Depreciation Overh...
EXHIBIT 32.14 Cost of Equity
EXHIBIT 32.15 Comparison to Historical Equity Risk Premiums by Characteristi...
EXHIBIT 32.16 Comparison to Historical Equity Risk Premiums Ranked by Risk M...
EXHIBIT 32.17 Industry Beta Analysis
EXHIBIT 32.18 Weighted Average Cost of Capital
EXHIBIT 32.19 Guideline Public Company Method: Ranking of Market Multiples
EXHIBIT 32.20 Guideline Public Company Method: Comparative Financial Analysi...
EXHIBIT 32.21 Guideline Public Company Method: Detail by Company
EXHIBIT 32.22 Guideline Public Company Method: Summary
EXHIBIT 32.23 Guideline Company Transactions Method: Detail
EXHIBIT 32.24 Guideline Company Transactions Method: Summary
EXHIBIT 32.25 Summary of Findings
Guide
Cover
Title Page
Copyright
About the Editor
About the Authors
Acknowledgments
Preface
Table of Contents
Begin Reading
About the Website
Index
End User License Agreement
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Financial Valuation
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JAMES R. HITCHNER
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About the Editor
James R. Hitchner, CPA/ABV/CFF, is the managing director of Financial Valuation Advisors, Inc., in Ventnor City, New Jersey. He is also president of the Financial Consulting Group, LLC, a national association of professional services firms dedicated to excellence in valuation, financial, and litigation/forensic consulting. He is CEO of Valuation Products and Services, LLC, a company that develops educational resources for valuation analysts and fraud/forensics practitioners. He holds the American Institute of Certified Public Accountants (AICPA) specialty designations of Accredited in Business Valuation (ABV) and Certified in Financial Forensics (CFF). Mr. Hitchner has more than 44 years of experience in valuation services. He has often testified as a qualified expert witness on valuations in federal and state courts in numerous states. He has coauthored more than 20 courses, taught more than 60 courses, published more than 150 articles, and made more than 400 conference presentations and webinars. Mr. Hitchner is editor/coauthor of the book Financial Valuation Applications and Models (FVAM), 5th edition (2025); coauthor of the book Financial Valuation Workbook (FVW), 5th edition (2025); and coauthor of the book Valuation for Financial Reporting: Fair Value, Business Combinations, Intangible Assets, Goodwill, and Impairment Analysis, 3rd edition (2011)—all published by John Wiley & Sons. He is coauthor of PPC’s Guide to Business Valuations, 18th through 31st editions, published by Thomson Reuters, and coauthor of A Consensus View, Q&A Guide to Financial Valuation (2016), and the Discount for Lack of Marketability Guide and Toolkit, (2017), published by Valuation Products and Services, LLC. He is editor in chief of Hardball with Hitchner, a monthly journal that presents views and tools from some of the leading experts in valuation, forensics/fraud, and litigation services. Mr. Hitchner is an inductee in the AICPA Business Valuation Hall of Fame and was twice a recipient of the AICPA’s Business Valuation Volunteer of the Year award. He was also one of the only four members of the original AICPA Business Valuation Standards Writing Task Force and served the entire six years up to the June 2007 official release of the standards. Mr. Hitchner is past chairman of the Business Valuation Committee of the Georgia Society of CPAs, past member of the AICPA Business Valuation Subcommittee, past member of the AICPA ABV Exam Committee, and past chairman of the ABV Exam Review Course Committee. He has a Bachelor of Science degree in engineering from the University of Pittsburgh and Master of Business Administration degree from Rider University.
About the Authors
R. James (Jim) Alerding, CPA/ABV, is the owner of Alerding Consulting, LLC, in Indianapolis, Indiana. He is a CPA and holds the AICPA specialty designation of Accredited in Business Valuation (ABV). Mr. Alerding has over 57 years of financial/accounting/investment experience, including over 40 years of business valuation experience. He has taught over 40 valuation courses, published numerous articles, and made hundreds of business valuation presentations. He has been recognized as an expert witness in numerous states and in state and federal courts across the United States and has testified over 400 times in depositions and trials. Mr. Alerding was a member of the writing task force for the AICPA Statement on Standards for Valuation Services No. 1 (VS100), and is a past member of the AICPA Business Valuation Subcommittee and an AICPA Business Valuation Hall of Fame member. He is a summa cum laude graduate of Xavier University with a bachelor’s degree in accounting. Mr. Alerding currently serves as legal editor for Business Valuation Resources.
Rosanne J. Aumiller, CPA/ABV, ASA, (retired) was a director at Citizens Valuation Advisory in Cleveland, Ohio, part of Citizens Capital Markets, Inc., a subsidiary of Citizens Financial Group. Ms. Aumiller provides business valuation and related consulting services to a wide variety of private and public companies. She has over 25 years of professional experience and has performed valuations for financial reporting, estate and gift tax planning, business succession, shareholder disputes, litigation support, and a variety of other purposes. Prior to joining Citizens, she provided these services while a director at Grant Thornton LLP. Prior experience also includes her role as a principal at boutique financial consulting and valuation firms, during her 10 years at a regional accounting firm, and while at Key Bank in the Valuation Services group. She holds the AICPA specialty designation of Accredited in Business Valuation (ABV) and is an Accredited Senior Appraiser (ASA) with the American Society of Appraisers. She has served as a member of the AICPA FVS Executive Committee, the AICPA Business Valuation Committee, and the AICPA ABV Credential Committee. She served on the task force to author the AICPA practice aid Business Valuations for Estate and Gift Tax Purposes. She is also a contributing editor of the AICPA FVS Digest. Ms. Aumiller served for five years as a director of the Cleveland Metropolitan Bar Association Foundation.
Don Barbo, CPA/ABV, is a managing director with VMG Health and leads the firm’s Litigation & Disputes valuation practice. For over 24 years he has performed valuations exclusively for the healthcare industry, involving mergers and acquisitions, divestitures, partnership transactions, leasing arrangements, financial reporting matters, divorces, diminution of value, and commercial damages. His extensive healthcare valuation engagements have included hospitals (acute care, long-term care, critical access, behavioral health, and surgical), physician practices (a variety of primary care and hospital-based), ambulatory surgery centers, diagnostic imaging centers, cardiac catheter labs, pathology and clinical labs, cancer treatment centers, and dialysis centers. Mr. Barbo has also performed engagements for various contracts between hospitals and physicians, including medical director agreements, on-call agreements, lithotripsy service agreements, professional services agreements, and management services agreements. Mr. Barbo also serves as an expert witness in litigation matters for his clients and has extensive testifying experience in various state and federal courts and involving a wide range of issues, including whistleblower actions, breaches of contract, shareholder disputes, bankruptcy and distressed businesses, and marital divorces. Prior to his valuation career, he served as the chief financial officer for a physician practice management company and as the controller/financial officer for various emerging companies. He began his professional career as an auditor with a Big 4 national accounting firm. Mr. Barbo is a member of the Medical Group Management Association (MGMA) and the Healthcare Financial Management Association (HFMA). He has served on the Technical Advisory Board of the AICPA’s FVS Consulting Digest and as a former expert panelist for the Financial Valuation and Litigation Expert journal. He holds a BBA in accounting from Texas Tech University, and an MBA from the Cox School of Business, Southern Methodist University.
Neil J. Beaton, CPA/ABV/CFF, CFA, ASA, is a managing director with Alvarez & Marsal Valuation Services, LLC. Mr. Beaton specializes in the valuation of public and privately held businesses and intangible assets for purposes of litigation support (shareholder disputes, lost profits claims, marriage dissolutions, and others), acquisitions, sales, buy-sell agreements, ESOPs, incentive stock options, and estate planning and taxation. He also performs economic analysis for personal injury claims, wrongful termination, and wrongful death actions. Mr. Beaton is a Certified Public Accountant (CPA), Chartered Financial Analyst (CFA), and Accredited Senior Appraiser (ASA). Additionally, he is Accredited in Business Valuation (ABV) and Certified in Financial Forensics (CFF). Mr. Beaton is a frequent lecturer at universities, is an instructor for various business valuation courses, and speaks nationally on business valuation with a special emphasis on early-stage and high-technology companies. Mr. Beaton has written two books on early-stage company valuation, has contributed to a number of other books on valuation and damages issues, and has written numerous articles on these topics. He is a former co-chair of the AICPA’s Valuation of Private Equity Securities Task Force, a former member of the AICPA’s ABV Exam Committee, and has served on the AICPA’s Mergers & Acquisitions Disputes Task Force. He is currently a member of the Business Valuation Update Editorial Advisory Board, a former expert panelist for the Editorial Board of the National Association of Certified Valuation Analysts’ Value Examiner, and a former expert panelist for the Financial Valuation and Litigation Expert journal. Mr. Beaton earned a BA in economics from Stanford University and a master’s degree in finance from National University.
Marc D. Bello, CPA/ABV, CVA, MAFF, CFF, MST, is a partner at Edelstein & Company, located in Boston, Massachusetts, leading the Business Valuation and Forensic Accounting team. Mr. Bello is a nationally recognized expert in business valuation and forensic accounting, and has appeared as an expert witness in the United States Tax Court as well as Massachusetts Superior Probate Courts. Mr. Bello’s expertise
