Forensic and valuation services

Q&A: Top issues in business valuation

Business valuation experts have been practicing in an evolving landscape for the past several years. New standards, changing technology, and an aging population are all playing a part in effecting changes. The JofA organized a round-table discussion of the important issues affecting CPAs who advise clients on business valuation matters.

AICPA asks Congress to block change in DOL fiduciary rule for ESOP appraisers

The AICPA has endorsed legislation designed to block any proposal from the U.S. Department of Labor (DOL) that would change the definition of “fiduciary” as it applies to the valuation of employee stock ownership plans (ESOP). The DOL in recent years has sought to expand the definition of a fiduciary

Gifts-in-kind: What are they worth?

A number of investigative articles have been written by the media and charity watchdog agencies questioning the valuation of gift-in-kind (GIK) contributions received by not-for-profit entities (NFPs). These articles identify various approaches to valuing GIKs, focusing on the large disparities between conclusions reached by NFPs, and questioning the application of

Fraud hotlines: Don't miss that call

Tip lines are one of the most effective tools organizations possess for detecting and preventing fraud. Fifty-nine percent of forensic and valuation CPAs participating in the AICPA’s 2011 Forensic and Valuation Services Trend Survey said internal whistleblower hotlines would lead to improvements in preventing fraud in the next two to

Top concern of FVS practitioners: Business development

The top priorities of forensic and valuation services (FVS) accountants have changed drastically over the past few years, with business development concerns outpacing technical issues, according to a new AICPA study. The 2013 FVS Membership Top Issues Survey found that “bringing in new clients,” the classic business development imperative, ranked

Auditors of fair value now eligible for ABV credential

Auditors of fair value for financial reporting are eligible for the AICPA Accredited in Business Valuation (ABV) credential as a result of a recent revision. The AICPA Forensic & Valuation Services (FVS) Section recently changed the experience requirement section of the ABV credential application kit to make the credential available

Survey: Business development now tops FVS practitioners’ list of concerns

The top priorities of forensic and valuation services (FVS) accountants have changed drastically over the past few years, with business development concerns outpacing technical issues, according to a new AICPA study. The 2013 FVS Membership Top Issues Survey found that “bringing in new clients,” the classic business development imperative, ranked

Private-investigator licensing emerges as potential threat to CPAs

The AICPA has made available to members an online guide detailing which states and cities require CPAs practicing forensic accounting to be licensed as a private investigator. More than 40 states have enacted laws requiring private investigators to buy a license to operate in their state. Most of those regulations

Evaluate your BV skills

With a wave of Baby Boomers nearing retirement, there is a good chance CPAs will come across clients who need a business valuation. A valuation may be necessary for gift and estate purposes, transfers of ownership, tax planning purposes, and divorce. CPAs need to determine whether they should perform the

Litigation, regulation expected to add to forensic and valuation workload

Forensic and valuation CPAs expect increases in litigation and regulation to add to their workload and make it challenging to hire and keep qualified employees, according to a new AICPA survey. Attracting and retaining qualified staff led the list of top challenges over the next two to five years, identified

Compilation reports for valuation engagements?

Business valuation (BV) reports frequently include information presented in the form of financial statements. The reporting requirements for such financial statements have drawn increased attention as a result of the issuance of Statement on Standards for Accounting and Review Services No. 19 (SSARS 19), Compilation and Review Engagements. When conforming

Bridging compensation gaps in a merger

Accounting-firm mergers must overcome numerous obstacles. One of the most common—and challenging—involves compensation and benefits for partners and staff. Merging firms usually have differences in compensation levels, compensation methods and benefits packages. It’s crucial for staff and partner retention that the merging firms combine the varying systems into one without

Valuing Contingent Consideration: Challenges and Solutions

When the FASB statement on business combinations was revised (modifying Statement no. 141 into Statement no. 141(R), now codified as FASB Accounting Standards Codification (ASC) Topic 805, Business Combinations), one change required that all items of consideration transferred by the acquirer be measured and recognized at fair value at the

Family Business Transition Planning

Family relationships and values can make succession of family businesses even more challenging than for other enterprises. Here are some suggestions for family businesses that can make succession planning and execution less trying. Obtain a valuation of the business regardless of whether it will be transferred between generations or sold.

Handling of Litigation Contingency Disclosure Facing Greater SEC Scrutiny

The SEC appears to be increasing its scrutiny of compliance with financial statement disclosure rules regarding potential court losses. The heightened attention is intersecting with a three-decades-old treaty for lawyers and accountants forged by the AICPA and the American Bar Association. The JofA spoke with attorney Michael Young, chair of

AICPA Panel Opposes DOL's Proposed Change to Definition of "Fiduciary"

The AICPA Forensic and Valuation Services Executive Committee (FVSEC) submitted a comment letter opposing a U.S. Department of Labor (DOL) proposal to change the definition of the term fiduciary. The FVSEC opposes the change because it would make virtually all valuations prepared for benefit plans, including employee stock ownership plans

Expert Testimony Guidelines for CPA Valuation Analysts

When giving expert testimony, CPA valuation analysts should be prepared to have their reports and testimony withstand the scrutiny of litigation and cross-examination. The following guidelines can help the valuation analyst prepare for potential vulnerabilities that opposing legal counsel may try to exploit. Check your resume. Opposing counsel typically investigates

A Competitive Analysis of Business Valuation Services

The business valuation practice area is maturing, and rapid growth is no longer the norm for the profession’s established firms. Although demand for valuation services is robust, it is harder for firms entering the field to earn superior returns unless they have a competitive advantage such as some existing expertise

Survival of the Analytically Fit: The DNA of an Effective Forensic Accountant

If attorneys could engineer the perfect forensic accountant, 78% of them would choose an accountant with strong analytical abilities. In a 2009 survey commissioned by the AICPA, after analytical skills, attorneys chose, in descending order, the abilities to be detail-oriented, ethical, responsive and insightful as the remaining top five essential

Valuing Art for Tax Purposes

Even people who don’t collect art probably own a painting or sculpture or two. At some point, one of two things is likely to happen: One, the artwork will be given away, perhaps as a noncash charitable contribution for which the owner will claim an itemized deduction, or as a

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2018 financial reporting survey: Challenges and trends

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