How to audit fair value measurements
The subjective nature of fair value measurements makes them a challenge for auditors. These tips—and a new framework for use by valuation professionals—can make the job easier.
Business valuation
AICPA seeks input for new framework on valuation of financial instruments
New guidance aims for clarity, consistency and transparency and will also lay the foundation for a new AICPA credential, Certified in Valuation of Financial Instruments (CVFI).
Drones set to invade accounting profession
Unmanned flying devices have the potential to bring new ways of doing business to accounting firms.
Four factors that will influence the L.A. Clippers’ sale price
Three quantifiable factors will influence the sale price of the Los Angeles Clippers—and one more will trump them all, business valuation (BV) experts say. The Clippers have been the talk of the sports world for the past couple of weeks after media outlets began airing a tape of racist comments
IRS oversight of CPAs who provide valuation services
Under Sec. 6695A, enacted by the Pension Protection Act of 2006, P.L. 109-280, appraisers may face monetary penalties for appraisals that lead to substantial and gross valuation misstatements on returns. This section is intended to provide greater assurance that all appraisers and appraisals meet a minimum threshold of qualification. These
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
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
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
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
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
Article Oversimplifies Becoming a BV Expert
I realize that it’s important to keep the pipeline full of younger CPAs who may develop an interest in the business valuation profession. Some of my colleagues have perceived a definite “aging” among BV’ers, with seemingly fewer younger members picking up the challenge. So I applaud the goal of attempting
How to Get Experience in M&A-Related Disputes
Editor's note: This is a sidebar to "The CPA's Role in Quantifying Post-Acquisition Dispute Damages," March 2010. Most CPAs with an accounting and auditing background have advised a client who has acquired or sold a business or business interest. Disputes may arise related to the M&A transaction as outlined in
The CPA's Role in Quantifying Post-Acquisition Dispute Damages
Given today’s environment of bankruptcies, bank failures and recessionary pressure, consummating merger and acquisition transactions is more challenging than ever. The potential disputes arising from the challenges of an M&A transaction are numerous. The following two types of disputes are the focus of this article: working capital disputes regarding whether
Breaking Into Business Valuation
An aging population, increased regulation and the move toward fair value reporting have led to increased demand for valuation services in recent years. As baby boomers approach retirement and start thinking about succession and estate planning, the first step is often valuing the family business. Changes to the tax code
