Updates on the TAF’s four working groups, plus a free BV glossary of terms from E&Y’s Aaron

The Appraisal Foundation (TAF) staff is currently preparing a white paper to document the recent roundtable on business valuation and address SEC concerns regarding the unity (or lack thereof) of the valuation profession and its standards, reported Tony Aaron (Ernst & Young) at the recent ASA Fair Value Conference in Los Angeles. Other updates from Aaron:

  • After releasing its draft on valuing customer-related assets this week, the TAF’s second working group will be analyzing comments on the draft and developing a finalized exposure document.
  • The TAF’s third working group on control premiums has just resumed after the busy season, trying to incorporate the many diverse views expressed during deliberations into an exposure draft. “A significant draft view is that many companies deserve very limited premiums,” Aaron observed. “A second significant draft view is that companies (or their advisors) need to quantify/support the existence of MPAPs [market participant acquisition premiums] with cash flow analysis.” Don’t expect a public exposure draft “until the fall of 2012, at the earliest.”
  • A fourth working group, on contingent consideration, is currently under way. Look for its scope of work to be posted this month, with deliberations to begin this summer or fall.
In addition, Aaron presented ASA attendees with two glossaries of terms that he has been putting together over the years, one related to the world of valuation and appraisal and the second related to accounting. He has graciously offered to make the glossaries available to the greater BV community on our free resources page. Anyone with additional terms is invited to email him at anthony.aaron@ey.com.