Business Valuation Sessions

Catherine J. Durham, ASA, Capital Valuation Group Inc.;
Reginald A. Emshoff, J.D., Capital Valuation Group Inc.

This session will address topics specific to business litigation, including how to find an expert witness, important traits of an expert, how to work efficiently with an expert, the timeline for working with an expert, preparing an expert for deposition and trial and how an expert can assist with the opponent’s deposition and cross examination.

We will cover the different causes or reasons for determining damages and discuss when the calculation of lost profits or lost value is applicable. Finally, we will look at specific damages situations including breach of contract, IP infringement, loss of key person and stockholder disputes. Learning objectives include gaining an understanding of:

• When and how to hire an expert and how to work efficiently with them
• Specific situations that require a calculation of lost gross profits as compared to lost business value
• How the calculation of damages differs among specific situations

10:30 a.m.–11:00 a.m.

Refreshment Break

11:00 a.m.–Noon

Economic Outlook

Scott A. Anderson, Ph.D., Wells Fargo Bank

This presentation will explore the factors behind current economic trends, the credit and liquidity crunch, housing market correction, weak U.S. dollar, and the ability of consumers and businesses to keep spending. The outlook for monetary policy, interest rates, and fiscal stimulus will also be addressed. Learning objectives include gaining an understanding of:

• The interaction between bank industry/financial markets and how it impacts the real economy and asset values
• The calculus that policymakers go through in setting interest rates and charting the direction of the U.S. economy

Noon–1:30 p.m.

Lunch Break (on your own)

1:30 p.m. - 2:30 p.m.

FAS141 and FAS142

Paul B. Siebrasse, ASA, RSM McGladrey; Mark N. Gehrig, ASA, Grant Thornton LLP

The presenters will co-lead a break-out session on practical aspects of FAS141 and FAS142 for business valuation professionals. Learning objectives include gaining an understanding of:

• The history of fair value accounting
• Practical guidance, including but not limited to:
• What really is a “market participant”?
• How should the discount rates be developed for various intangible assets?
• What appraisal methods should be used from what identifiable asset?
• Unique issues for privately held companies vs. public companies
• Form or function—does a complex valuation method with many assumptions yield better results than a simpler method with fewer assumptions?
• The market analysis of impairment—AOL/TimeWarner $50B goodwill write-off: Did the market care?

2:30 p.m.–3:30 p.m.

Valuation Issues and the IRS/Areas of Interest for RP Appraisers and BV Valuers from the IRS/Updates on Penalties and Voluntary Compliance

Michael A. Gregory, ASA, Internal Revenue Service

During this session, participants will be updated on the Service’s current initiative on 409A valuations, noncash charitable contributions initiatives on several fronts, penalty developments and applications, as well as marked improvements in voluntary compliance in specific market segments. By the end of the session participants should have a clearer understanding of what is expected from them and how they can help their clients avoid potential confrontations with the IRS. Learning objectives include gaining an understanding of:

• How the IRS wants to partner with and outreach to those involved with valuation work
• The fact that the IRS wants to help them and their clients avoid a confrontation and continue to improve voluntary compliance
• How the IRS is approaching several technical areas (business valuation in the 409A area, various non¬cash charitable donation areas), as well as an update on penalty applications in the valuation area

3:30 p.m.–4:00 p.m.

Refreshment Break

4:00 p.m.–5:30 p.m.

Questions Regarding the Pension Protection Act of 2006

William Forsberg, Leonard, Street, and Deinard, PA, with Michael Gregory, ASA, Internal Revenue Service

This session will address the new appraiser penalties under Internal Revenue Code Section 6695A enacted as part of the 2006 Pension Protection Act. It will begin with a detailed analysis of the new appraisers penalties, including a discussion of valuation misstatement attributable to incorrect appraisals as applied to estate, gift and income tax valuations. Finally, there will be a panel discussion with a representative of the Internal Revenue Service on the subject of how the penalties are enforced in the field. Learning objectives include gaining an understanding of:

• The new appraisal penalties under Internal Revenue Code Section 6695
• How the IRS is enforcing the new penalties in the field and what types of appraisals are most likely to be subject to the new appraiser penalty provisions