- Goodwill in a professional partnership poses unique challenges for valuators and courts, especially in a divorce setting. In a recent Texas case dense with valuation issues, it came down to corporate goodwill. “Logic tells me there is some,” the trial court said, “but it’s probably impossible to quantify.” The finding triggered an appeal.
- The big news, says Prof. Jack Bogdanski (Lewis & Clark Law School) in his seventh annual symposium on developments in federal tax valuation, is that there were hardly any business entity valuation cases. Unlike last year, when cases involving family limited partnerships (FLPs) were aplenty, this year the Internal Revenue Service seems to have poured its resources into challenging taxpayer claims for charitable contribution deductions related to conservation and facade easements. The latter, in particular, have become a mass-marketing tax shelter tool in areas such as New York City and have triggered a vigorous response from the IRS. Litigation typically focuses on whether the appraisal is qualified, whether the expert testimony was admissible under Daubert, and finally—assuming the case is still alive—what the value of the restriction is.
- The value of privately held businesses is very high right now, according to the 2014 Capital Markets Report from Pepperdine. This annual report benchmarks both the current climate and projected outlook across multiple market segments for lending, investing, and acquiring capital.
- As banks prepare for their annual valuations, take note of recent trends in the primary and secondary influencers on bank values. The economy and bank values are improving; however, bank income is limited and therefore bank values are suppressed.
- Recent evidence in purchase price allocation under fair value purchase accounting rules reveals more value is being allocated to identified intangible assets and less to unidentified goodwill.