Q1 2024 Update Middle Market Credit Spreads, Required Returns
The markets tighten further and 2024’s outlook remains cautiously optimistic.
Goodwill Impairments Impacted By High Interest Rates
As interest rates remain high, companies may need to become more mindful about corporate goodwill.
European Private Market Update
Read VRC’s latest insight into the European private markets: 2024 (potentially) promises improved deal flow and an improved fundraising environment as market participants gain clarity on economic factors.
Exploring Private Debt Market Valuations
Explore the strengths that ensure stability in the private credit markets from a review of risk considerations to reporting requirements to how market variables can impact valuations.
The SEC's Private Fund Adviser Rule: Investor Protection and Industry Impact
Explore the motivations behind the SEC’s release of the Private Fund Adviser Rule, its provisions and scope, and how the industry has responded to this regulatory development.
VRC Leaders to Present at M&A Science Spring Summit
Patel, Sapnas and Mellen will delve into the state of valuation in 2024 and share insights into the current market environment.
Valuation Perspectives From Around the World
Increased analysis within financial reporting comes with increased levels of analysis required for tax reporting.
Intangible Asset Valuation for Tax Purposes
Dive into the complexities of valuing intangible assets for tax purposes and unravel the differences between Fair Market Value and Arm’s-Length Standards.
The Practice and Potential Pitfalls of Using Non-Competes to Reduce Tax Exposures Associated with Golden Parachutes
The value of a non-compete may help lower the tax bill, but it needs to be appropriately valued to avoid potential scrutiny by tax authorities.
Before Invoking the Insolvency Exclusion for Cancelled Debt Income Companies Must Be Ready to Support Their Case
Cancellation of debt can generate significant tax liabilities that can be reduced by demonstrating insolvency. But, without experienced advisors, the process of proving insolvency can be challenging.
Essential Estate Planning and Valuation Updates
Key highlights, discussions, and resources from our experience at the 2024 Heckerling Institute event, from a valuation professional’s perspective.
Can I Use My 409A Valuation Report for a Gift or Estate Tax Filing?
The short answer is that you can use a 409A valuation report for a gift/estate tax filing, and you may get away with it if you’re not audited. You shouldn’t.
4Q 2023 Update Middle Market Credit Spreads, Required Returns
The markets tighten further and 2024’s outlook remains cautiously optimistic.
European Private Market Update
VRC’s latest research into the European private markets reveals a narrowing trend in coupon spreads for loans amid intensifying competition, prompting a 25 bps reduction in fairway credit spread ranges, impacting yields and signaling shifts in deal dynamics for 2024.
VRC Named Valuation Firm of the Year by M&A Turnaround Awards
Honored by The M&A Advisor Awards for Valuation Firm of the Year!
Inflation Driving Commercial Property Insurance Value Reassessments
As inflation reshapes commercial property values, uncover insights driving companies to reevaluate insurance needs with a replacement cost analyses.
2024 Deals Outlook and Valuation Trends
In the year ahead, expectations are for transformative deals by increased cross-border activity, a positive private equity outlook, ESG considerations, global tax changes, and more.
Backtesting to Satisfy SEC Valuation Rule
VRC weighs in on the rule’s flexibility, explaining the onus is on the mutual fund board to lay out the valuation process, or its designee.
Navigating Startup Financing: Insights Into Venture and Growth Equity in Challenging Markets
A broad overview of the industry, financing terms, valuation considerations, and exit options in a challenging market.
Stock Options & ASC 718: Consider Total Ramifications
The top six issues you need to address when issuing share-based compensation.
Solvency Opinions: Approving Leveraged Dividend Recapitalizations
Board members can demonstrate that they have fulfilled their fiduciary duties in dividend recapitalization transactions by obtaining opinions from third-party solvency opinion experts.
The Private Loan Market is Offering Incentives for Sustainability Achievements
Focusing on the influence of ESG on private company valuations and strategic choices.
European Private Market Update
While the European private debt market faces heightened competition, deal flow is expected to improve in 4Q 2023 and early 2024 as market participants anticipate and more accessible fundraising environment and improving market conditions.
Navigating the Choppy Waters of Private Equity
When looking at 2023’s PE landscape, the turbulence is clear. In exploring key trends, challenges and strategic shifts, we note that industry players are resiliently charting a course forward.
Pay vs. Performance Disclosure Requirements
Unlock the complexities of the SEC’s Pay vs. Performance Disclosures to seamlessly navigate the regulatory landscape and set the stage for a confident proxy season.
How Private Lenders Treat Discounts on New Loans
Through an informal survey, VRC identified a discernible preference for treating the OID as incremental yield consideration and amortizing it over the life of the loan, though that approach is by no means uniform.
The ASC 842 Lease Accounting Implementation Saga Continues
Explore the ongoing saga of ASC 842 lease accounting implementation, including its impact on private and public companies. Learn about practical shifts, clarifications, and the challenges of determining the incremental borrowing rate (IBR) as VRC offers a dual methodology approach.
Insights Into Collateralized Loan Obligations, Long-Term Intertranche Premiums
Delve into the dynamics of CLO investments as we focus on the IRR comparison between CLO equity and BB-rated CLO debt to asses the ongoing validity of long-term inter-tranche premium used by market participants.
Venture Capital Down Rounds Reach Five-Year Highs: What Lies Ahead?
In today’s venture capital landscape, challenges persist, and companies delaying fundraising must face the reality that a near-term light at the end of the tunnel is not guaranteed.
How Private Borrowers Are Holding Up Against Persistent Inflation, Earnings Headwinds
A close look at private debt markets shows many borrowers need more wiggle room and are counting on a reversal in short-term rates or more forbearance from lenders.
VRC Receives Top M&A Advisor Honor: Valuation Firm of the Year 2023
Firm receives top industry honors for the eleventh consecutive year.
Navigating the Changing Tides of the SPAC Market Liquidation Wave
SPACs are liquidating faster than ever, and the crashing wave is changing the way investors think about their SPAC positions.
Handling Sustainability Triggers in Valuation
The use of SLLs is becoming widespread, but pricing and valuation can be complex.
Rucker and Expert Panelists Dig In To Rapidly Growing $72 Billion GP-Led Secondaries Market
After a modest slowdown in late 2022/early 2023, GP-led secondaries market is picking back up.
Gottfried Helps ABA Tax Section Pen Comment Letter on IRS APA and MAP Revenue Procedures
Group suggests ways to improve the IRS’ Revenue Procedures governing Advance Pricing Agreements and Mutual Agreement Procedures.
Key Points in Valuing Profits Interests
Profits Interests are valued as options, and when estimating their fair value consider the total equity framework, including vesting interests.
Continuation Funds: Valuation and Fairness Opinion Considerations
A review of the continuation fund market and a growing consensus that fairness opinions are necessary best practice for the health of the market. Plus, the SEC may be requiring them soon.
Estate Planning Valuation Considerations for Privately Held Businesses Preparing for Sale
Business owners preparing for a sale but still needing to execute their estate plan may see beneficial opportunities in using a common estate planning tool.
Pay vs. Performance Disclosure Requirements: Expected term of option grants, simple or not?
Addressing the challenge of developing and supporting the expected term used in the Black-Sholes Option Pricing Model to determine fair value of grants to PEOs and NEOs.
The Venture Capital Cycle
Analyzing past market patterns can signal the issues private market and venture capital investors may anticipate in the cycles ahead.
Private Loans Find Their Level During LIBOR's Last Hurrah
In what may be seen as a barometer, lenders still incorporating CSAs are squeezing all the juice they can out of their deals by pushing for ARRC’s recommended spread.
SEC Requires Pay-Versus-Performance Fair Value Disclosures
Public company filer disclosures must provide added color on the full scope of executive compensation packages, changes in fair value of equity awards issued principal and named executive officers.
Transfer Pricing and Tax Valuation for Restructurings
In this webinar, leaders from VRC and Global Tax Management discuss how to ensure that business restructurings and reorganizations meet the relevant business and tax objectives.
Evaluating Private Company Lease Accounting Options Under ASC 842
The holiday is nearly over for many private companies with significant right-of-use assets meaning companies will need to adopt ASC 842 effective Jan. 1, 2022, in preparation for their first calendar year-end reporting date.
OECD/G20 Base Erosion and Profit Shifting Project Updates
Access updates on BEPS Pillar Two, the OECD-sponsored overhaul of global tax regimes.
Goodwill: What’s Really Happening & What Comes Next
In this webinar, a panel of leading minds from VRC, Calcbench, CFA Institute, and Financial Reporting Advisors discuss why and how goodwill matters.
SPAC Market Update: Who turned on the lights?
After years of hype, de-SPAC results are disappointing, stock performance has cratered, and the SEC is hitting the breaks.
Understanding the Tax and Valuation Considerations of Purchase Price Allocations
In this webinar, valuation and tax experts discuss how to ensure that purchase price allocation is properly determined.
Do Impairment Indicators Exist?
In analyzing four factors that will likely incur increased audit scrutiny, do patterns emerge that can indicate impairment?
Tax and Valuation Considerations for Section 382
In this webinar, valuation and tax experts discuss tax considerations, methodologies, limitations on NOLs, and financial statement considerations & disclosures under Section 382.
Tax and Financial Reporting Differences in an Allocation of Purchase Price
One of the key differences in valuations for tax vs. financial reporting lies in the definition of value.
Machinery & Equipment Valuations: Understanding the Importance of a Site Inspection
Three machinery & equipment valuation engagement scenarios highlight when a site inspection is required.
Middle Market CLOs: Proven Stable Performance in Volatile Credit Markets
The history and data of collateralized loan obligations show that CLOs, in general, and middle-market CLOs specifically, continue to perform very well through various economic cycles and market shocks.
How Direct Loan Market Participants Are Handling the Handoff from LIBOR to SOFR
SOFR is emerging as LIBOR’s benchmark successor for private loan market participants. Key differences in maturity and credit profiles must be considered.
Why VRC?
Why do public companies, private equity firms, and asset managers rely on VRC for their critical valuation and advisory service requirements?
Valuing Venture Debt vs. Debt Instruments
What makes valuing venture debt investments unique compared to debt investments in more established companies?
FASB Implements Improvements to Deferred Revenue Accounting in Acquisitions
New FASB guidance allows companies to apply the revenue recognition standard (ASC 606).
With $3.6 Trillion in Goodwill on the Books of U.S. Companies, Panelists Argue Attention Must Be Paid
The continued growth of goodwill raises the stakes for U.S. & international standards setters considering changes to the way companies account for the assets.
With Greater Liquidity Comes Greater Private Asset Valuation Frequency
The new buzz phrase—”monthly valuation”—is taxing internal valuation teams and redefining relationships between fund sponsors and valuation providers.
Why VRC for Portfolio Valuation?
Learn why eminent private fund managers and their boards rely on our team.
Resource Guide to Navigating SEC Rule 2A-5
VRC’s Rule 2a-5 Resource Guide provides the details fund managers and fund boards need to come into compliance with the SEC’s new regulations to fair value portfolio securities.
SEC to SPACs: Blank-Check Path to IPO, Warrants, Disclosures Have Liability Risk
The SEC has been clear. They will continue to keep a close watch on SPAC filings and disclosures and their private targets.
How Fairness Opinions Help Private Equity Sponsors Head Off Family Feuds
Related-party transactions between PE funds and their portfolio companies are fraught with the potential to create issues between limited partners. Fairness opinions can forestall such conflicts.
Why Get a Fairness Opinion?
Fairness opinions have a critical role in mergers, acquisitions, and other corporate transactions, yet sometimes public and private companies might overlook the importance.
Best Practices for Private Fund Sponsors
As the demand for transparency rises for private investment funds, the spotlight is on valuation practices, which is essential for any fund manager to understand.
Top 7 Questions About Fairness Opinions
VRC’s Opinion Practice Group experts answer the top questions asked about fairness opinions for financial transactions.
Three Reasons Your Organization Needs a Fairness Opinion
If your organization is considering a merger, acquisition, or disposition, the time is now to seek out the services of an independent, third-party opinion provider.
What Is a Global Brand Worth?
Before making a purchase, acquirers should make sure a plan is in place to maximize the value of the acquired brand.
Considering Brand Value: What’s In a Name?
Any brand valuation presents a strategic planning opportunity to understand more about what drives value to the underlying company.
SPAC Shares Are Not Created Equal
How do you value a SPAC? With a surge in SPAC IPOs resulting from the COVID-impacted economy, SPAC valuations should not be given equal consideration.
In Flux: The Current State of Goodwill & Impairment
As public companies enter the traditional fourth-quarter impairment testing period, two big question marks are hanging over the market…
Economic Obsolescence: Discover loss of value caused by external factors
Identifying, measuring,and applying the adjustment for EO can be a complex and iterative process.
Private Equity & Debt Capital Markets Adjust to the New Normal
As we head into Q4 2020, the new normal in private capital markets has fully set in, generally defined by prudence and caution, albeit a work in progress.
COVID Impact on Non-Control Equity Holdings
Both public and private companies carrying minority equity stakes at cost under FASB ASC 321 may need to fair value them due to COVID-19.
New World Order Valuations
Developing valuations in a COVID-affected economy means taking new, altered views of a company along with making industry analysis de rigueur.
BDC Roundtable Participants Lean Heavily on VRC’s Czapla for Guidance on Navigating COVID Fallout
Business Development Company market participants are focused keenly on valuation in the wake of the novel coronavirus and the impact on their underlying portfolio investments.
Ready. Set. IP-whoa.
Valuations are a requirement throughout the IPO process. Management teams are well-advised to seek professional expertise early to avoid missteps and save time, efforts, and cost.
NFL Team Options: Value and Risk
The principles developed in valuing common stock options can provide insight into what sports contracts are worth and how they affect risk.
Rollover Equity for Private Equity Deals
Valuation considerations for rollover equity in PE platform acquisitions.
Top 10 Drivers to Enhance Company Value
Now is an ideal time for private company owners to focus on factors that will improve their business value in the event of an opportunity to sell.
Valuation Considerations Relating to Section 382 Limitations
Sweeping changes to the utilization of NOLs have occurred as a result of the Coronavirus Aid, Relief & Economic Security Act (CARES Act) in 2020.
The SEC's Not-So-Gentle Reminder: Show Your Work
The SEC is making it a priority to focus on impairments related to COVID-19.
Avoiding Valuation Surprises in M&A
Not every company uses the same method for valuation. Recently, VRC and one of its key partners shared insight into their valuation “secret sauce.”
SEC Requires Third-Party Fairness Opinion Certificate for BDCs
The SEC recently announced, as a response to COVID-19, they will provide temporary exemptions to BDCs to issue and sell senior securities.
Valuation Essential to Restructurings, Bankruptcies
Many businesses hit hard by the current economic shutdown may need to restructure through an out of court workout, a Chapter 11 reorganization, or a Chapter 7 liquidation. In all cases, an objective valuation is a key component.
Private Credit Managers Grapple with Growing Pains
As private credit manager valuation leaders scrutinize how to optimize their internal teams, they also are leveraging technology tools and third-party service providers—both domestic and offshore—to meet the demands of scale.
Adopting Fresh Start Reporting when Emerging from Bankruptcy
Even with a massive infusion of federal funding for businesses, a rise in bankruptcies is beginning.
Bulls vs. Bears vs. a Pandemic: How do Control Premiums Change?
In market downturns, can we anticipate the impact on control premiums? VRC analyzed the data.
Measuring Triggering Event Impacts and Subsequent Impairment Testing
Some of the most significant financial consequences of the pandemic and other triggering events can be seen in both current and coming company disclosures.
Best Practices in Accounting for M&A Transactions (Part 2)
In the second episode of VRC’s video series, we discuss non-controlling interest in private equity deals and step acquisitions.
Does My Early-Stage Company Need a Third-Party Valuation?
If your company is on a trajectory towards success, now is the time for a valuation consultation about the required analysis and support to take risk off the table.
Cross-Border Tax Planning and Asset Transfers
How have in-house tax executives transitioned valuation considerations to mission-critical?
Best Practices in Accounting for M&A Transactions (Part 1)
In the first episode of VRC’s video series, we discuss determining the purchase price allocation in the deal, earnout structures, rollover equity, non-controlling interest in PE deals, and step acquisitions.
Podcast: Navigating Intangible Asset Valuation
Patel: In today’s environment where companies are more intangible asset-based rather than tangible asset-based, there’s probably an evolution that needs to happen in terms of how you value inventory.
Understanding Collateralized Loan Obligations
CLO vehicles are the lifeblood that helps keep the syndicated loan market humming.
Older & Wiser: The Evolution of 409A
As startups stay private for longer periods of time, their common stock valuation (409A) history is likely to be scrutinized if they pursue an IPO.
Private Credit Players Taking AICPA Guidelines, Growing Market Pressures In Stride
Market participants embrace best practice guidance, adjust policies accordingly. But the AICPA’s best practices are not without challenges and intricacies for the private debt and private credit professional.
Leveraging MSO Structures To Infuse PE Investment In Physician Practices
Private equity investor interest in the physician practice sector has been gaining steady momentum.
Rollover Equity: Don't Just Take It At Face Value
Several factors, including the rights and preferences of the rollover equity compared to the private equity sponsor’s shares and the sources of deal financing, have important implications for valuation.
The State of Goodwill & Impairments
A video discussion about corporate goodwill, goodwill impairment, and financial analysis techniques that aid in determining if a business combination is living up to performance expectations.
How to Win Your Fantasy Football League? Use Valuation Methodologies!
Want to crush your fantasy football championship? Take a page out of a valuation professional’s playbook.
Understanding Tax Amortization Benefit Considerations and the International Impact
Tax amortization benefit rules differ between countries, and they can also change over time.
What's the Haircut? Determining the Fair Value of Deferred Revenue
When managing deferred revenue, the valuation challenge is defining the performance obligation.
Personal Image Rights: A Tax Evasion Update
Revisiting the outcomes of two high-profile tax evasion cases involving image rights.
Valuing Private Equity & Private Debt
Private equity and private debt investors are acutely focused on new AICPA Guidance that recommends a “calibration” approach for valuing private securities.
Valuation Takeaways From Market Volatility Spikes
Market volatility spikes prompt considerations of appropriate methodologies for factoring market indications into valuations and reflection on when “smoothing” techniques should be employed.
Q1 2019 Economic Snapshots
Quick-hit visual summaries of the leading economic and financial indicators in major economic markets.
The Evolution of the Distributor Method
Originally considered a unique approach to determining the fair value of customer-related assets, the method has become mainstream methodology and evolved into a foundational analytical tool.
Transfer Pricing Has Changed
Changes for related-party transactions, especially among subsidiaries of multinational corporations, make updated transfer pricing studies a necessity to justify the charges, often including royalty rates, for these transactions.
Contingent Consideration: Practical Pointers for Earnouts in Business Combinations
Contingent consideration can salvage a business combination when buyer and seller can’t agree on value, which is especially true in a frothy deal environment with high valuations and overpayment concerns.
ASC 842 Lease Accounting: Simplifying the Incremental Borrowing Rate Debacle
Implementation of the ASC 842 lease accounting standard is putting companies in a challenging position to determine their applicable incremental borrowing rate.
Private Equity & Venture Capital Valuations
How did a roomful of credit managers learn to stop worrying and love the AICPA Private Securities Valuation Guide?
Real vs. Personal Property: Distinguishing Between the Two Can Impact Property Tax
Tax benefits exist for companies that distinguish real versus personal property. However, legal nuances, if interpreted inaccurately, can bring significant economic consequences.
Podcast: Tax Reform's Impact on Valuation
Nearly a year since the Tax Cuts and Jobs Act was signed, there are still a number of questions about how to apply the new law but some areas, such as valuation, are beginning to get some clarity.
Personal Goodwill: Hunting & Bagging an Elusive, Tax-Advantaged Prey
Allocating a portion of proceeds from the sale of assets of a private company to the personal goodwill of a major shareholder can result in significant tax benefits to buyer and seller.
Fairness Opinions: How to Avoid Conflicts of Interest When Seeking a Provider
Fairness opinions provide substantial benefits – if the opinion process is performed correctly.
Podcast: Valuations in M&A
“We’ve come a long way in terms of determining how to calculate fair value.”
Tax Reform Flips International IP and Tax Structuring into Reverse
VRC has noticed an emerging phenomenon: U.S.-based multinationals are taking steps to move intellectual property back into the U.S.
Charitable Gift Valuations Before Business Sale
During robust M&A cycles, donor-advised funds tend to become popular philanthropic vehicles.
Convertible Notes Valuation
The valuation challenge with a hybrid security is to consider both the equity and debt components in a combined framework – this challenge is not without its tradeoffs.
Introduction to a Refined Approach to Inventory Valuation
With limited authoritative guidance around inventory valuation best practices in business combinations, these modifications may improve the valuation process.
Receiving Dependable Fairness Opinions
Boards of directors can improve the likelihood of receiving a more defendable fairness opinion by making specific inquiries of their opinion provider.
Comprehensive Tax Reform in Argentina
New tax laws in Argentina promotes investment, represents a significant change for U.S. companies doing business in the region and results in new tax value of assets.
What's In A Name? For Luxury Brand Valuations, Everything
In the high-end luxury market, where virtually all of an enterprise’s value derives from its brand or brand portfolio, the ability to accurately assess its value – to quantify and render tangible the intangible – is especially critical.
The Value of Valuation Research Group
Our experience includes foreign and multinational acquisitions of all sizes in nearly every industry.
Relying on Solvency Opinions: Considerations for Company Boards
Company boards often seek third-party solvency opinions in connection with leveraged transactions to assist them in fulfilling their board duties.
Accounting and Valuation Conference Tackles Critical Issues for Credit Funds
Ahead of an uncertain 2018, senior VRC professionals provided their insights regarding trends in accounting, valuation, taxes and other industry practices.
ESOP Trustees Should Require Peer Review in ESOP Valuations
Because of regulatory pressures, Employee Stock Ownership Plan trustees should implement a peer-review process for ESOP valuation reports.
Image Rights: Valuable Intellectual Property
The cult of celebrity and “Image Rights” receive a lot of publicity – and consequently the attention of tax authorities.
Podcast: Valuation Challenges in Accounting for M&A
Companies will need to take more ownership of their valuations.
Employee Stock Ownership Plans and the Tax Act
The continued popularity of ESOPs remains a tax-efficient approach to selling company stock.
The Only Legal Requirement for Fairness Opinions
California Corporations Code Section 1203 requires an affirmative fairness opinion to provide target shareholders with greater protection in takeover transactions.
Market Multiple Adjustments
Benchmarking and adjusting market multiples for multinational company valuations by focusing on growth, risk and profitability.
Section 2000: Alternatives to Private Company Dissolution
Those seeking dissolution under California Corporations Code Section 2000 need to understand the role of appraisers as well as the ramifications of the standard and premise of value.
The Impact of the 2017 Tax Act on Business Valuation
Q&A: How is the Tax Cuts and Jobs Act impacting company value and valuation approaches?
Valuation Q&A: Trusts and Estates
What did the 2017 Tax Act change that would impact estate planning?
What Directors Consider During Takeover Talks
What issues must board members contemplate when facing a competitor’s takeover offer?
Keys to Avoiding Failed M&A Deals
50 percent of M&A deals fail. How can a board avoid deal failure before an acquisition?
Ask the Expert: Valuation’s Changing Role in Financial and Tax Reporting
Perspectives on the advantages and other considerations associated with seeking valuations.
Tax and Dealmaking
A valuation partner who understands the role and responsibilities of the tax professional can bridge solutions to meet acquisition objectives.
Managing Deal Stakeholders
Valuations need to meet the requirements of all stakeholders – corporate development, financial reporting & tax. Can it be done?
Deal-Related Accounting Implications
The role of the CFO and the corporate controller’s group continues to grow and evolve into a critical position with the deal team.
Stakeholder Alignment
Whether it is the original deal price, accounting related issues, or tax-related issues, you really have to have all of those parties on the same page, speaking the same language and communicating. Valuation is at the center of that.
Goodwill Hunting: Elimination of Step 2 & the Implications for Public Companies
The FASB has sought to simplify the accounting for goodwill impairment for several years.
FASB Issues Accounting Standards Update Clarifying the Definition of a Business
Within the ASU guidelines, there are two main thresholds to determine if an entity is a business.
Best Practices for Valuing Contingent Consideration
VRC continues to see many transactions where contingent consideration has been present.
Five Misperceptions: Credit Valuation Adjustments in Swap Valuations
An overview for corporate accounting professionals of Credit Valuation Adjustments and five common misperceptions about them.
Preparing for FASB Changes to Revenue Recognition and Lease Accounting
FASB guidance addresses inconsistency and weakness in existing revenue recognition and lease accounting requirements.
All in the Family (Office): Valuation Needs for Direct Private Equity Investments
Family offices making private equity investments need to be aware of valuation issues related investments in complex structures.
Can Your Business Have a Range of Value?
Did you realize that your business has multiple values at the same time?
Optimal Number of Trials for Monte Carlo Simulation
A Monte Carlo Simulation is a technique is often used to find fair value for financial instruments for which probabilistic distributions are unknown.
ESOP: An Exit Opportunity for Professional Service Firms
VRC performs fairness opinions in connection with newly forming ESOPs and annual ESOP valuations.
International Case Study: Valuing Distressed Energy Assets
In 2015, oil prices plummeted, which had a profound effect on the value of oil & gas and energy companies.
Valuation Q&A for Business Development Companies
Once we understand a BDC’s investment thesis and portfolio, VRC focuses on the valuation process.
VRG: Our International Capabilities
We invite you to meet our international affiliate team and learn more about the depth of our capabilities and expertise.
Equity Incentive Awards Based on Total Shareholder Return
Share-based payments have led to boardroom creativity around an equity incentive award’s design, prompting developments in valuation approaches.
Key Value Drivers in Wealth Management Firms
Wealth management is human capital driven, which is measured through the financial operating results of the business.
IPO Readiness: Valuation Issues Related to Taking a Company Public
Valuation considerations must be managed carefully to minimize the time, effort and costs of the IPO filing process.
Understanding Convertible Debt Valuation
Companies seeking lower interest costs particularly as firms refinance maturing debt, convertible notes offer alternatives to straight debt securities. However, they come with complex valuation requirements.
Techniques for Valuing Carried Interest
In receiving value only if a threshold is met, carried interests have an asymmetric payoff similar to a stock option.
Accounting's 21st Century Challenge: How to Value Intangible Assets
How do you attach a price tag to something you can’t see or touch?
Transfer Pricing Rules Have Implications for Intellectual Property Valuation
The OECD is moving in a direction similar to the U.S. in tightening controls.
Why Private Companies Should Look Into Valuations
Why should a private company board consider a valuation of the company?
Understanding and Valuing S Corporations
The most significant court case was probably Gross vs. Commissioner, which held that an S-Corp has a tax rate, but that tax rate was zero.
Valuing Carry
IRS regulations and the past performance of the management team are among the considerations needed to value carried interest rights
Distributor Method: An Alternative Technique for Valuing Customer Relationships
A point often overlooked is that customers usually purchase products or services because of the presence of intellectual property, not a relationship.
Valuing Carried Interests
The asymmetric nature of carried interests requires the consideration of a range of scenarios.
Valuing the Panama Canal for Insurance Purposes
How do you place a supportable value on a major landmark like the Panama Canal?
ESOP Fables: Reviewing The Myths and Facts About Employee Stock Ownership Plans
In reality, many businesses are a perfect fit for ESOPs.
Pre-Acquisition Valuation: Intangible Assets and Contingent Consideration
In several instances, the knowledge gained from valuation support in the due diligence phase results in modifications or cancellations of transactions.
M&E Assets: Determining the loss of asset value from functional obsolescence
Determining the fair value of M&E assets for financial reporting purposes should include the consideration of three forms of depreciation: physical, economic and functional.
The ABCs of BDCs: Private Debt and SEC Concerns
Business development companies, or BDCs, represent a growing class of relatively large, closed-end, SEC-registered funds.
Common Valuation Issues With Illiquid Securities
Nuanced securities typically contain options and market conditions that alter cash flows over the life of the security and raise valuation challenges.
Valuations Offer Support for Ad Valorem Tax Savings
A valuation of the property in question, obtained from an independent valuation provider, is critical to building an ad valorem case.
Functional Obsolescence: Loss of Asset Value Caused By Inefficiency or Inadequacies
A prudent investor will either implicitly or explicitly consider FO in the determination of a purchase price for the entire business.
Golden Parachute Payments Under Section 280G
Golden parachute payments may be made to disqualified individuals contingent upon a change in control.
Getting Your Head Out of the Model
Appraisers valuing a multinational company should expand their due diligence process to solicit information from company management about specific effects of operating in their particular location.
Understanding the Valuation of Profits Interests in Private Equity Transactions
To value profits interests, the economics of the equity capital must be clearly incorporated into the valuation.
Valuation Critical for C Corp to S Corp Conversion
Why does an entity choose to convert from a C corporation to an S corporation?
Market Participant Acquisition Premiums
When valuing a business, determining the control premium is a significant, and often controversial, issue.
Issues Pertaining to Accounting for Income Taxes
Valuation allowances are one of the areas frequently challenged by auditors.
Fair Value Pricing: How Directors Can Avoid Material Risks
Valuation specialists must be prepared to defend the choice of valuation methodology, assumptions, and judgments to those who depend on valuations.
Fair Value Considerations: Accounting for Embedded Derivatives
Embedded derivatives require valuation at issuance and revaluation at all subsequent quarters with changes in value reported in earnings (non-cash).
Backsolve and Hybrid Approaches for Valuing Complex Equity Capital Structures
The backsolve method derives from a timely transaction in a private company’s equity.
Finding the Value of BDCs
The board of directors of a BDC has the ultimate responsibility to ensure the fund’s portfolio represents fair value.
Major Tax Issues Impacting Private Equity Firms
Various forms of executive compensation have become popular, resulting in much scrutiny, particularly in how these forms of compensation are taxed.
Challenges in Valuing Contingent Consideration
ASC 805 provides guidance for whether it is contingent consideration or compensation.
PCAOB Comments Increase Auditor Scrutiny of Fair Value Measurements
Auditors have increased scrutiny around management forecasts which provide the foundation for valuation methods based on an income approach.
Three Approaches to Valuing a Privately-Held Company
Before considering a deal, it’s helpful to have a clear understanding of the three common methodologies used to value private businesses.
Become Fluent in Factors for Valuing Multinational Companies
When valuing a business that is multinational in scope, develop a proper due diligence framework and apply models that will accurately reflect the company’s exposure to various risks.
Carried Interest Popular Form of Incentive Compensation
Since carried interest is tied to performance, it is an effective way for employers to recruit and retain employees.
Valuing a Minority Shareholder’s Common Stock Amid Capital Restructurings
Valuing investments in private companies requires a flexible approach.
What's the Value of My Business or Asset? It Depends...
Many factors of a business must be considered when answering the question “what is the value of my closely held business.”
Using the Distributor Model to Value Customer Relationships
The distributor method is a powerful tool for the valuation of customer relationships in situations where these relationships are a supporting asset and where there are appropriate market inputs.
Valuation Plays Key Role in Section 338 Elections
Sec. 338 elections take two forms: the Sec. 338 (g) election, used for foreign acquisitions, and the Sec. 338(h)(10) election, used in domestic cases.
Worthless Stock Deduction May Result in Tax Benefits
Obtaining a valuation from an independent valuation provider is essential to proving that the security has no liquidating value.
Purchase Price Allocations Support Section 338 Elections
In general, the impact of a Sec. 338 election is that a stock acquisition is treated as an asset acquisition.
Cost Sharing Agreements an Effective Tax Planning Tool
The impact of the investor model is that it essentially guarantees a return to the intangibles developer for its efforts.
Tax Considerations During Troubled Economic Times
For companies who have not filed for bankruptcy, the insolvency exception is critical.
Valuation Integral to Sec. 409A Requirements
The valuation of a development-stage company’s common stock is best estimated using the methods in the Practice Aid.
Deferral of Cancellation of Debt (COD) Income Could Result in Substantial Tax Saving
Determining the degree of insolvency is a key step since this will dictate the amount of COD income which may be excluded.
Valuation Considerations for Acquisition Structures
A key tax consideration is whether the acquirer will be entitled to a stepped up tax basis in the assets and thus entitled to future tax deductions.
Foreign Direct Investment: Tax and Valuation Considerations
In the case of a U.S. acquisition of a foreign target, it was oftentimes beneficial to make a Section 338(g) election.
Valuations Provide Critical Support for Asset Acquisitions
When valuation is important for tax purposes, breakdown by legal entity is key since each has its own tax identity and related tax consequences.
Valuation Provides Support for International Transactions
When a company embarks on an international restructuring, it is extremely important to consider the impact of Section 367.
Legislation Increases Benefits of Cost Segregation Studies
By employing a cost segregation study, a significant portion of a property may be reclassified to a shorter life category.
Independence Critical When Selecting Opinion Provider
The independence of a fairness or solvency opinion provider is a critical issue that will not be overlooked by regulators or minority shareholders.
Valuation Integral to Execution of Tax Strategies
Multinational companies face several compliance and planning issues.
Pre-Acquisition Valuation Key Step in Due Diligence Process
Identifying and valuing intangible assets in advance of a purchase has become a valuable step in the due diligence process.
PCAOB Scrutiny Highlights Importance of Audit Review
The valuation industry has experienced a significant increase in time allocated to auditors in the review process.
Practice Issues Pertaining to Sec. 409A
In the original Practice Aid, there was no mention of the back-solve approach. Since then the technique has come into widespread use.
How Do You Put a Price Tag on the Panama Canal?
How Do You Put a Price Tag on the Panama Canal?