Reasonable Compensation, A Specialist’s Approach
Reasonable compensation for owners/executives is often one of the most critical adjustments in a business valuation. Accordingly, it is imperative that valuation practitioners understand the best practices of reasonable compensation analysis. Evaluating reasonable compensation goes beyond simple data entry into a software program. Join us for this insightful program that will delve into the methodologies specialists use to assess compensation, highlighting unique scenarios and providing multiple examples of common pitfalls and flawed approaches.
BV News and Trends December 2024
A monthly roundup of key developments of interest to business valuation experts.
Short Takes and Tips From the Annual ASA Conference
There was a lot of interesting information to be found both inside the sessions and at the various networking events at the recent ASA Annual Conference in Portland, Ore.
A&M releases IPO compensation report
Alvarez & Marsal has released its annual “Initial Public Offering Compensation Report,” which is an analysis of executive compensation arrangements among companies with recent IPOs.
BV News and Trends April 2024
A monthly roundup of key developments of interest to business valuation experts.
BVR Power Panel offers insights into recent issues
BVR has an ongoing webinar series of Power Panels, consisting of veteran practitioners and thought leaders covering recent trends and issues.
Watch out for ‘black box’ compensation apps
During his session on reasonable compensation at the Forensic and Valuation Conference hosted by the Virginia State Society of CPAs, Neil Beaton (Alvarez and Marsal) discussed the various compensation benchmarking surveys and subscription databases.
Reilly examines key Tax Court case on reasonable comp
Nationally known valuation expert Robert Reilly (Willamette Management Associates) has done a comprehensive 17-page article on the Hood case—a Tax Court case with some important and practical guidance on determining reasonable compensation.
Final issue of Willamette’s Insights focuses on best practices
The Winter 2023 issue will be the final one for Insights from Willamette Management Associates.
BV News and Trends January 2023
A monthly roundup of key developments of interest to business valuation experts.
Business Valuation Case Law Yearbook, 2023 Edition
January 2023 PDF, Softcover (195 pages)
BVR (editor)
Business Valuation Resources, LLC
Hot Topics at the 2022 VSCPA Forensic and Valuation Conference
It was back to in-person attendance at the 22nd annual Forensic and Valuation Conference hosted by the Virginia State Society of CPAs. Topics included the income approach, effective recruiting, reasonable compensation, guideline transactions, surviving cross-examination, IRS developments, and a “Hardball With Hitchner” session that covered some front-burner issues.
New Case Points Up Practice Opportunity in Reasonable Compensation
Opposing counsel attacked a valuation expert over his expertise in assessing reasonable compensation—and also criticized the data he used. The expert prevailed in this challenge, which illustrates that valuation experts can take on engagements in tax matters and shareholder disputes involving the fair market value of executive compensation.
Private firms pay a median $30,000 in board retainers
To support adjustments for reasonable compensation when doing private-company valuations, comparable data are necessary.
Willamette focuses on wealth transfer valuation
Estate and gift tax planning and valuation issues are the focus of the Autumn 2022 Insights from Willamette Management Associates.
Pinto v. Schinitsky
The Supreme Court of New York denied motions to dismiss assertions of excess compensation, payments to a consultant, and a salary paid to the defendant’s mother. The court also denied a Daubert motion to exclude the plaintiff’s expert on the reasonableness of compensation. The plaintiff’s expert, a CPA, was found to qualify even though reasonable compensation was not his competency for his practice.
New York Court Denies Claims in Three Damages Categories, Denies Daubert Motion to Exclude Experts
The Supreme Court of New York denied motions to dismiss assertions of excess compensation, payments to a consultant, and a salary paid to the defendant’s mother. The court also denied a Daubert motion to exclude the plaintiff’s expert on the reasonableness of compensation. The plaintiff’s expert, a CPA, was found to qualify even though reasonable compensation was not his competency for his practice.
Is the IRS Job Aid on reasonable comp still relevant?
Released in 2014, the “Reasonable Compensation Job Aid for IRS Valuation Professionals” is an internal IRS document designed to help review compensation reported on federal tax returns.
Business Valuation Case Law Yearbook, 2022 Edition
January 2022 PDF, Softcover (177 pages)
BVR (editor)
Business Valuation Resources, LLC
The legal coverage and in-depth analysis from the BVR legal team deliver lessons learned to help appraisers reach better and more defensible valuation conclusions. All the cases featured in this book impart important lessons about applicable legal principles, approved and discredited valuation methodology, and the act (and art) of presenting expert opinions. This must-have collection benefits both the generalist as well as the specialist.
Learn more >>BV News and Trends December 2021
A monthly roundup of key developments of interest to business valuation experts.
Recap of the VSCPA Forensic and Valuation Virtual Conference
Topics at the Virginia CPAs’ event included COVID-19, the use of statistics for lost profits, key federal tax cases, personal goodwill, forensics, reasonable compensation, and cybercrime.
IRS sending agents to NACVA’s BV training
The IRS is sending 79 agents to business valuation training provided by the National Association of Certified Valuators and Analysts (NACVA), according to former IRS manager Michael Gregory (Michael Gregory Consulting LLC).
Record attendance at VSCPA conference
Again this year, BVR was pleased to sponsor the two-day Virginia Society of CPAs Forensic and Valuation Services Virtual Conference, which saw record attendance, reports Harold Martin (Keiter), who served as chair of the conference planning task force.
Federal Tax Litigation, Expert Witnesses, and the IRS
Michael Gregory will address key rules for federal expert witnesses, valuation issues with the IRS, identify key recent BV federal cases, and introduce you to what to expect in 2022. This session will also share information you need from a business valuer that mediates, negotiates, and facilitates alternative dispute resolution to give clients timely closure with significant savings with the IRS and others. After this session you will be able to: reference key federal statutes ...
Parties’ agreement complicates spousal support calculation in S corp context
Instead of facilitating a resolution, a separation agreement between the divorcing spouses led to a protracted lawsuit.