Hitchner on citing BV books and cases

BVWireIssue #241-1
October 5, 2022

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case law analysis, expert testimony, conference, valuation report, valuation methods

It’s fine to cite authoritative texts in your report—but court cases are another story, advises Jim Hitchner (Financial Valuation Advisors). He spoke at last week’s Forensic and Valuation Services Conference hosted by the New Jersey Society of Certified Public Accountants (NJCPA).

Big three: Hitchner pointed to the three main texts in the BV profession: Valuing a Business (by the late Shannon Pratt), Gary Trugman’s Understanding Business Valuation, and his own Financial Valuation Applications and Models. He has cited all of these resources in his reports when appropriate, pointing out that the Pratt book has just come out with its new sixth edition (done by a group of contributors). The Trugman book is “very different in style and tone” and is “full of good stuff,” he noted. Hitchner also said he is working on the fifth edition of his book, which is scheduled to come out in the first quarter of 2023. All of these books are available from BVR.

Cases: As for court cases, they should not be cited, he advised, but there are exceptions. If the attorney advises that the jurisdiction has an important case that is used as precedent for a certain valuation approach or methodology, citing that case may be appropriate. And, of course, the Mandelbaum case is fine to cite in your DLOM section.

The NJCPA conference, hosted by Roy Kvalo, director of litigation and valuation services at The Churchin Group (Red Bank, N.J.), was excellent, and we’ll have more coverage in future weeks.

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