What It's Worth: Law Firm Value

January 2017 PDF (149 pages)

BVR (editor)

Business Valuation Resources, LLC

The number of law firm mergers and acquisitions have reached record levels over the past few years—the highest annual total recorded in nine years was reached in 2015 according to MergerLine. This boom in law firm M&A, along with the impending mass retirement of baby boomer attorneys who own law firms, has created a wealth of opportunities for business appraisers and consultants. BVR's new special report, "What It's Worth: Law Firm Value," provides a solid foundation for determining law firm value and offers law firm owners critical advice on succession planning. This comprehensive resource helps appraisers understand the key considerations to take into account when valuing a law firm including goodwill, origination credits, billing, and productivity. Plus, it provides key industry trends and data to help benchmark the value of a law firm.
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Categories: industry analysis


Additional Detail


Highlights of the report include:

  • Tackle the unique challenges that law firm valuations can present with an overview of the methodologies used, the special considerations to take into account, and a useful checklist of questions to ask management when performing a law firm valuation
  • Understand the top value drivers for law firms with current market information including the drivers for firm consolidation, raising expenses, and a shifting competitive market
  • Have the latest benchmarking data and rules of thumb at your fingertips with analysis from Pratt’s Stats and rules of thumb from the Business Reference Guide on the sales of privately held law firms
  • Understand how to apply the excess earnings method to value the goodwill of a law firm with a comprehensive case study
  • Learn how the courts ruled on key aspects of law firm valuation with a look at 11 important court cases where law firm value was front and center
  • Get critical advice on succession planning for law firm clients and owners
  • Offers a demonstrative law firm valuation report, which gives you insight into the work product that can be expected when an appraiser opines on the value of a law firm

Table of Contents

  • ABOUT THE EDITOR
  • INTRODUCTION
  • SECTION I: LAW FIRMS: VALUE DRIVERS AND VALUATION CONSIDERATIONS
    • TRENDS IMPACTING LAW FIRM VALUE
    • OVERVIEW OF METHODS FOR VALUING LAW FIRMS
    • SPECIAL CONSIDERATIONS IN VALUING LAW FIRMS
    • CHECKLIST OF SPECIAL INFORMATION TO REQUEST FOR THE VALUATION OF A LAW FIRM
    • COMMON ERRORS IN VALUING PROFESSIONAL PRACTICES
      By Kevin Yeanoplos, CPA/ABV/CFF, ASA
    • GOODWILL IN PROFESSIONAL PRACTICES
    • APPLYING EXCESS EARNINGS TO DERIVE THE VALUE OF GOODWILL
    • WHEN A LAW FIRM GETS CAUGHT UP IN DIVORCE:  AN ATTORNEY AND AN APPRAISER COMPARE NOTES
  • SECTION II: CURRENT MARKET FOR LAW FIRMS
    • TOP TRENDS IN THE LAW FIRM MARKET
    • BUY-SELL LANDSCAPE FOR LAW FIRMS
  • SECTION III: SELLING AND SUCCESSION PLANNING FOR LAW FIRM OWNERS
    • LAW PRACTICE TRANSFER CONCERNS
    • PRACTICE FOR SALE: SELLING A PRACTICE
    • EXIT PLANNING CONSIDERATIONS FOR ATTORNEYS
      By Ronald L. Seigneur, ASA, CVA, CPA/ABV/CFF
    • SUCCESSION PLANNING FOR ATTORNEYS AND LAW FIRMS
      By Ronald L. Seigneur, ASA, CVA, CPA/ABV/CFF
  • SECTION IV: FINANCIAL AND VALUATION DATA FOR LAW FIRMS
    • LAW FIRM VALUATION MULTIPLES BASED ON PRATT’S STATS DATA
    • PRICING LAW FIRMS—RULES OF THUMB
  • SECTION V: VALUATION AND THE COURTS
    • LAW FIRM VALUATIONS IN THE COURTS: CASES OF NOTE
    • Bakst v. United States of America (In re: Kane & Kane)
    • In re Marriage of Barten
    • Development Specialists, Inc. v. Weiser Realty Advisors LLC                                                               
    • Dixon v. Crawford, McGilliard, Peterson & Yelish
    • Hartley v. Hartley
    • In re Marriage of Kingery
    • In re Marriage of Restaino
    • In re Marriage of Ross
    • Von Hohn v. Von Hohn
    • Walsh v. Walsh
    • Weinberg v. Dickson-Weinberg
  • SECTION VI: RESOURCES
    • DEMONSTRATIVE LAW FIRM VALUATION REPORT
    • LAW FIRM FINANCIAL METRIC AND BUSINESS MODEL RESOURCES