ASA 2017 Advanced Business Valuation Conference

The American Society of Appraisers' Advanced Business Valuation Conference is the premier event for valuation professionals. This 2.5 day live web streaming event delivers the best of the Advanced BV Conference featuring industry leaders speaking on key topics that are important to the valuation professional. Register for 1, 2 or 2.5 days.

Sunday, October 8, 2017

9:35am - 10:35am - Cash and Working Capital in the DCF Method

Trey Stevens, ASA, MCBA - Managing Director - Stevens & Greer, LC

While cash may be the simplest asset to value, the treatment of cash in the discounted cash flow method can be challenging. One approach is to include cash as part of working capital and incorporate the change in cash as part of the projected cash flow. In some situations, a portion of the cash may be considered to be excess cash and is valued separately. Another approach is to treat the entire cash balance as excess cash and add the cash to the value of the operating assets of the firm. Through the use of examples, this presentation will discuss the different ways in which cash can be treated in the discounted cash flow method.

11:00am - 12:00pm - Case Study:  Calculating the WACC

Travis Harms, CFA, CPA/ABV - Senior Vice President - Mercer Capital

In this case study approach attendees will develop a greater understanding of: the iterative nature of the cost of capital and the firm's capital structure; how to assess and interpret the marginal cost of capital; and ow to infer the cost of capital for guideline public companies and develop appropriate adjustments for subject entities.

1:30pm - 3:00pm - Normalizing Owner Compensation

Stephen D. Kirkland, CPA, CMC, CFC, CFF - Consultant and Expert Witness - Atlantic Executive Consulting, LLC

This session will explain the methodologies for normalizing owner compensation in business valuations.  It will include practical tips for improving efficiencies, documenting analyses, avoiding common mistakes and drawing defensible conclusions. It will cover advantages and disadvantages of various sources of compensation comparability data.  A case study will be provided and Mr. Kirkland will share his experiences from testifying in five U.S. Tax Court cases. 

3:30pm - 4:30pm - Using New REIT Data to Value FLPs – Theory and Application

Spencer Jeffries - President & Founder - Partnership Profiles, Inc.

James R. Park, ASA - Partner - Munroe, Park & Johnson, Inc.

Family limited partnerships (FLPs) continue to draw the attention of the IRS in gift and estate tax engagements.  It is important to understand and use reliable empirical data to determine the Fair Market Value of FLPs and LLCs.  Hear from the founder of Partnership Profiles, Inc., Spencer Jefferies, about new REIT data that can be used to value minority, nonmarketable interests in real estate entities.  Mr. Jefferies will provide both a historical and current look at publicly-registered partnership and REIT data and how it should be used for valuation purposes.  Jim Park, co-author of “Comprehensive Guide for the Valuation of Family Limited Partnerships”, will show how to apply this data to effectively employ the Income and Market Approaches in a practical case study.  This will be an information rich presentation with helpful handouts and practical advice to use this information in your appraisals.

4:35pm - 5:35pm - Evidence of DLOMs for Controlling Interests

The session will provide an overview of: the differing positions, for and against, DLOM for controlling interests; the theory behind DLOM for controlling interests; as well as a potential source of market evidence regarding DLOM for controlling interests.

Monday, October 9, 2017

9:05am - 10:35am - Critiquing a Valuation Report: The Top 20 Errors

Michael A. Paschall, ASA, CFA, JD - Managing Director - Banister Financial, Inc.

This session will attempt to educate participants on how to identify common errors in an opposing expert's valuation report and avoid making the same errors in your valuation report.

11:00am- 12:00pm - Bulletproofing Your Valuation for Tax Court

David D. Aughtry,  Esq. - Managing Partner - Atlanta

Imagine that your firm, a CPA firm, and a trial team are preparing to attack a report.  Now imagine that it is your report.  Expert reports for trial in Tax Court differ from expert reports attached to a return.  We will focus on how to fortify your report, strengthen your credibility and impact, and turn a cross-examination to your advantage.

1:00pm - 2:00pm - Update on IRS Regulations Including S Corp Tax Affecting

William H. Frazier, ASA - Managing Director

The future path of estate and gift tax valuation is uncertain. With the Republicans in control will the estate tax be repealed?  Will it be replaced with a capital gains tax? Will the gift tax remain? Are the proposed changes to section 2704 likely to be finalized? By the end of the summer of 2017, more clarity should exist. The session will be designed to aid appraisers especially with estate planning projects-the effectiveness of which often hinges upon valuation.

2:05pm - 3:05pm - Maintaining Objectivity in your Adjustments and Normalization

James A. Anderson, ASA, CPA/ABV/CFF - Partner - Hemming Morse LLP

Maintaining objectivity in adjustments and normalization is vital. This session will take a closer look at: what are normalization adjustments; differentiating between normalization adjustments and non-recurring expenses; and determining reasonable compensation - arguably the most challenging normalization adjustment in a valuation.

3:30pm - 5:00pm - Top Issues Attracting Scrutiny of ESOP Valuations and Fairness Opinions

Jeffrey S. Tarbell, ASA, CFA - Director - Houlihan Lokey

Appraisers that render ESOP valuations and fairness opinions are well aware that litigation activity has never been higher. Both regulators and plaintiff's counsel are actively pursuing claims against plan trustees for basing their fiduciary decisions on "faulty" valuations. This presentation will describe the major issues raised in recent lawsuits and explore what appraisers can do to help our clients -- and ourselves -- minimize risk by developing ESOP valuations that withstand the scrutiny of DOL investigations and ERISA litigation.

Tuesday, October 10

8:00 – 9:30am - Valuing Companies Owning Real Property

Alan Kaplan, MAI, MRICS - Director - Grant Thornton

This session will provide insights into valuing companies owning real property (for example, hotel companies, casinos, convenience stores, nursing homes, REITs, etc.) and the issues surrounding cost of capital. You will learn more about how to reconcile the approaches of real estate appraisers and BV appraisers, including discounts for lack of marketability.

9:35am - 10:35am - Market Participant Acquisition Premiums (MPAP): The Final Word

Andrew S. Fargason, CFA - Managing Director

Led by one of the members of The Appraisal Foundation's working group on best practices for control premiums, the session will provide an overview of the new monograph on the MPAP.  Topics will include the general MPAP framework, some of the exposure draft comments received, and the group's primary considerations in reaching the final draft.  

10:50am -12:20pm - Applications of the Market Approach Relief from Royalty (RFR) Method to Value Intellectual Property

Robert F. Reilly, CPA - Managing Director

This session provides a deep dive into the market approach, including how to: distinguish the four categories of intellectual property (IP); identify the generally accepted market, income and cost approach IP valuation methods; explain the selection of the RFR method for a particular IP valuation analysis; explain the conceptual basis for and practical application of the RFR method; distinguish available IP license transaction databases; their relative strengths and weaknesses along with criteria for searching and selection of comparable uncontrolled transaction (CUT) IP licenses; and much more… leading to value synthesis and conclusion procedures in workpaper files and reports.

Basic Course Information

*Analyze ways in which cash can be treated in the discounted cash flow method

*Interpret the marginal cost of capital

*Determine methodologies for normalizing owner compensation

*Apply REIT data to effectively employ the Income and Market Approaches

*Recognize methods of forecasting balance sheets and cash flow statements

*Identify common errors in an opposing expert's valuation report

*Compare business models for banks and other financial institutions and how the model differs from that of non-financial institutions

*Asses when forensic accounting is needed to determine or support normalization adjustments differentiating between normalization adjustments and non-recurring expenses and how to use practice aids to save your testimony in front of the judge

*Business Valuation

*Taxation