MBAF is pleased to present the November/December 2017 issue of Litigation & Valuation Report. We encourage you to read through it for ideas about ways you can stay current with the latest trends in business valuation and best use a valuator’s expertise to support litigation.
Using Data Analytics to Help Prevent and Detect Fraud
Organizations that use proactive data monitoring can reduce their fraud losses by an average of 54% and detect scams in half the time, according to the Association of Certified Fraud Examiners’ 2016 Report to the Nations. This article provides insight into how forensic accountants can use data analytics technology to detect patterns and uncover anomalies that may help unearth fraud in real time.
Got IP? Value It With the Relief from Royalties Method
Intellectual property (IP) is often among a business’s most valuable assets. The value of IP typically comes into play when IP rights are infringed or when selling the asset or the entire business. This article provides an overview of how IP is valued under the relief from royalty method.
Transupport, Inc. v. Commissioner
Court Rejects Compensation Expert’s “Result Oriented” Approach
Perceived independence is critical when it comes to the effectiveness of expert witness testimony. This article discusses a recent case in which the U.S. Tax Court rejected an expert’s testimony on the reasonableness of compensation paid to shareholder-employees, because he’d failed to provide an “independent and objective analysis.”
Transupport, Inc. v. Commissioner, T.C. Memo 2016-216 (November 23, 2016)
Spotlight on Damages
Experts Shouldn’t Assume Causation
Many attorneys see causation as a legal issue that’s outside a financial expert’s body of knowledge and expect their financial expert to simply accept a plaintiff’s theory of causation. This article explains why this reasoning may be flawed and provides a real-life example of how failure to distinguish damages caused by the defendant from other types of business losses puts an expert’s testimony at risk for being excluded.
American Aerial Services v. Terex USA, LLC, No. 2:12-cv-00361-JDL, U.S. Dist. Ct., D. Maine (April 29, 2015)