Considering obsolescence for recycling equipment Following the most recent transfer of ownership, an expansive multi-generational waste management and recycling corporation in central California needed a business valuation for gift tax return. While a business valuation can be performed without an equipment valuation, in the case of machinery-heavy industries, the prudent option is to involve…Read More
Streamline Business Dissolutions with Shared Appraisal Expert
Shareholder and business partner dissolutions occur for a multitude of reasons, including disputes. Examples of dispute situations include a shareholder mishandling corporate information, a partner acting inappropriately, or a personality conflict among shareholders. In business disputes of this kind, a business valuation (BV) is the simplest and most cost-effective way to determine the value of…Read More
Financial Reporting Appraisals: Acquisition Accounting
One of my favorite accounting professors, Dr. Larry Watkins, PhD, CPA, retired last year from Northern Arizona University, where I took many accounting courses before finishing up & graduating from Arizona St University in Tempe. In the years after I got my ASA and before he retired, we got together a few times for what…Read More
Appraisal Review Risks and Rewards
The American Society of Appraisers recently posted an excellent discussion of appraisal review practice by our ARM colleague Mark Penny, ASA, ARM-BV, BV-IA. Mark’s article is primarily for appraisers who perform review work or are interested in doing so. It’s also an interesting read for those who might need an appraisal review. Lawyers often need…Read More
Case Study: Purchase Price Allocation for a Legacy Food Processing Facility
In an equipment appraisal for financial reporting purposes, the initial rough numbers were almost twice the purchase price. Because the enterprise had been on the market for a number of years and the purchase was an arm’s length transaction, that big difference between the preliminary calculation and the purchase price didn’t make sense … until…Read More
Equipment Depreciation: Discount for Ownership
Calculating accurate deprecation for equipment values is critical; explaining how that depreciation was calculated is just as important, especially for litigation cases, property tax appeals or purchase price allocation situations. Equipment can lose value in any of the three standards areas: physical depreciation, functional obsolescence, and economic obsolescence. In some valuation situations, the loss of value…Read More
Family Law & Litigation Q&A in Healdsburg, May 21, 2018
We’re hosting a Q&A about equipment appraisals for litigation and family law in Healdsburg on Monday, May 21, 2018. If you’re in the area, we hope you’ll join us. For more information or to register for the event, click here Please visit our Attorney Support page to learn more about our services for the legal community….Read More
Successful Acquisitions include Equipment Appraisals
The headline “Common Mistake for Sellers” caught my eye in a recent article about acquisitions in the printing industries’ Printing Impressions: Common Mistake for Sellers Sellers almost invariably overestimate the value of their equipment, according to Hahn. The only way to get an accurate estimate, he adds, is through a professional, industry-specific equipment appraisal, the results…Read More
The Financial Risks of Flawed Appraisals
A previous post introduced the five qualities of a credible appraisal, and in a perfect world, the equipment appraisal report you’re basing financial decisions on would always adequately address those USPAP-specified qualities. The fact is though, that in this imperfect world many equipment appraisal reports don’t meet the basic requirements of completeness, accuracy, adequacy, relevance,…Read More
When to Worry About the Accuracy of Your Appraisal
An appraisal review or expert rebuttal report is a good choice whenever you feel confused about the methodology used in an equipment appraisal report or uneasy about the qualifications of the equipment appraiser. This could be a report you originally contracted for – or it could be an equipment appraisal report you’ve received from another…Read More
The Difference Between an Appraisal and an Appraisal Review
When clients call our office asking for an equipment appraisal review, I’ve found it’s important to ask them the purpose of the appraisal review. That quickly opens up the discussion about what an equipment appraisal review is and is not. And believe me, not everyone understands the difference between an appraisal (a quantitative analysis) and…Read More
Purchase Price Allocation Appraisals
When CPA firms need appraisals for financial reporting purposes, it’s often related to business combinations. Appraisals for business combinations are most commonly needed when one business entirely gains a controlling interest over another. At that point, the purchase price allocated on the books needs to be split out, with specific amounts allocated to inventory, land,…Read More