Regarding last week’s brief write-up of the California divorce case (In re Marriage of Devries), Linda Trugman writes: “My understanding is that it was case concerning a 2005 valuation and the AICPA’s SSVS-1 weren't effective until January 2008.”
This is correct—and the complete case digest in the Feb. 2010 BVUpdate includes this point. However, the Devries court also cited California precedent in which an accountant deviated from AICPA guidelines in effect at the time of the accounting practice. In that case, “the court did not embrace the AICPA guidelines as the benchmark for the applicable standard of care for accountants,” the Devries court noted. “And nowhere did the court suggest the guidelines should trump established case law.” Key takeaway from the case: Although the SSVS-1 guidelines are certainly binding on CPAs, they may be relevant to but are not dispositive (legally determinative) of valuation issues before the court.
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