BVWire attended the Joint ASA 2018 Advanced Business Valuation and International Appraisers Conference in Anaheim, Calif., and the sessions and networking events were excellent. Here are a few takeaways from just some of the sessions we attended:
- The Big Four firms are holding off on the new CEIV credential for fair value for financial reporting pending the resolution of quality control issues regarding the inspection process;
- When testifying in court, you face a number of preconceived notions, including the strong perception of being a “hired gun,” so make it absolutely clear you’re being an advocate for your opinion, not an advocate for the client;
- Valuation experts can’t be all things to all people, so specialize either in an industry or area of valuation (e.g., estate and gift, ESOPs, intangibles, etc.);
- At the start of a purchase price allocation engagement, talk with company management about what it sees as the overall value drivers of the firm;
- When doing a valuation of a company that rents space, spend time examining the lease, particularly the lease term, renewal options, and leases with related parties; to get market rent, some states require a broker’s price opinion;
- Pay particular attention to control issues in ESOP valuations—did the ESOP actually get the control it paid for? (DOL doesn’t like the term “control premium”);
- The major concern of the move to “retail health” is the effect on brand value;
- Startups are looking more to Hong Kong for funds—the listing rules have changed there concerning prerevenue companies; and
- Prospective financial information (PFI) deserves much more scrutiny than it has been given.
We’ll have more takeaways in future issues.
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