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March 25 Webinar - Changing Perspectives on Valuation of Private Minority Interests

by User Not Found | Mar 09, 2014

The American Society of Appraisers is pleased to announce the hosting of an upcoming webinar titled Private Minority Interests Are NOT Bought or Sold Based On Discounts! to air Tuesday, March 25, 2014 from 2:00-4:00p.m. ET.

Most business appraisers (and most users of business appraisals) don’t realize that a discount for a private minority interest can only be calculated after the value of the interest has been determined. This is because buyers and sellers in the real world don’t actually do these types of transactions based on “discounts” for lack of control and lack of marketability. Instead, investors purchase private minority interests based on economics such as cash flow and rate of return.

Staying informed of the latest issues through continued professional development and accreditation in programs like the Society’s Accredited Senior Appraiser program is important not only to maintain a competitive edge, but also to help avoid fines and penalties for both you and your clients, as evident in the recent case (Richmond, 2014)1 , where due to the appraiser not being certified, the Tax Court determined the appropriate value and assessed a penalty.

The webinar will explore how market participants buy and sell private minority interests, what this means for the appraisal business, whether conventional wisdom on discounts can coexist with the real world, the implications for overturning bad case law and some little-known but very important guidance on the subject from the American Society of Appraisers.

After attending this webinar attendees will be able to:
  • Identify the connection between markets in the real world and valuation practice;
  • Use knowledge about the actions of actual market participants to improve your analysis;
  • Note how Procedural Guideline 2 (ASA BV Standards) can help focus your analysis and step up your game in valuing private minority interests; and 
  • Develop new models and report formats that more accurately reflect the real world of minority interest transactions.

The webinar presenters are: Bruce A. Johnson, ASA and Eric Nath, ASA, both of whom are designated members with the Society. Detailed bios are available online.

This fast-paced webinar could completely change current perspectives on valuation of private minority interests and is a must-see presentation for business appraisers, CPAs, attorneys, tax court judges and company owners who operate in the world of traditional “discounts” for lack of control and lack of marketability.

To register or for more information, visit ASA online or call (800) 272-8258.

The views and opinions expressed by the presenters are those of the presenters and not of the American Society of Appraisers.

1 Estate of Helen P. Richmond et al. v. Commissioner. T.C. Memo. 2014-26; No. 21448-09. (2014). Retrieved from http://www.ustaxcourt.gov/InOpHistoric/Est.ofRichmond.Memo.Gustafson.TCM.WPD.pdf