Valuing Trained and Assembled Workforces in Healthcare Provider Entities: A Deep Dive

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Training Event Transcripts
October 25, 2016
Timothy R. Smith, CPA/ABV
Angie Smith, CVA

Summary

When valuing trained and assembled workforce (TAWF) in healthcare provider entities, such as physician practices, imaging centers, hospitals, ASCs, and the like, many appraisers get it wrong. Experts Tim Smith and Angie Smith discuss the most common reason including a misunderstanding of the correct application of the cost approach as currently formulated in the professional literature or the nature of training for healthcare provider employees, especially for physicians. Often appraisers have not correctly analyzed functional obsolescence for training or they fail to account for economic obsolescence due to lack of understanding of the theory behind the cost approach. In addition to these missteps, hear an in-depth overview of four cases purported to show TAWF has value under liquidation and a critique of the theory that bankruptcy case law supports the idea of value for TAWF under liquidation. Learning to value trained and assembled workforces correctly is key to understanding the debate about how physician practices are valued.
Valuing Trained and Assembled Workforces in Healthcare Provider Entities: A Deep Dive
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