Determination of Value: Appraisal Guidance on Developing and Supporting a Credible Opinion

Content: Preface xi     Acknowledgments xiii     Chapter 1: The Problem 1     In Search of a Truth 1     The Assurance Expert 4     Credibility Is Not Synonymous with Truth 7     Where Do We Go from Here? 8     Chapter 2: The Solution 9     Toward a Defi nition of Credibility 9     The Attributes That Make You Credible 10     Operational Credibility Attributes 11     Personal Credibility Attributes 19     General Observations about    Credibility    21     Credibility Is Not Synonymous with Truth 23     Don   t Confuse Opining with Decision Making 25     Beware of Black Box Opinions 26     Conclusion 26     Chapter 3: The Credibility Pyramid and the Importance of a Well-Defined Analytical Process 29     The Importance of Process 29     The Valuation Process 31     The Credibility Pyramid 34     Three Problem-Solving Phases 36     Conclusion 41     Chapter 4: Pyramids, Not Castles 43     Why Is Credibility Important? 44     Reasonable Assurance 47     Generally Accepted Practices 50     Generally Accepted Practices Lead to Uniformity and Professional Consensus 54     Analytical Gaps 55     Informed Judgment 56     Conclusion 59     Chapter 5: Climbing the Credibility Pyramid 61     The Importance of Revenue Ruling 59   60 61     Identification of Key Pre-Engagement Parameters 63     Planning to Acquire Knowledge about the Subject 65     General Planning Considerations 69     The Importance of the Standard of Value as You Climb the Pyramid 79     Self-Assessment Tools 83     Stepped Reading 87     Conclusion 88     Chapter 6: How to Develop and Report Your Opinion 91     Practice Presenting Your Written Findings Orally 91     Valuation Adjustments 102     Description of a Benchmarking Methodology Used by Valuation Analysts 106     Benchmarking: Relative Weights and Qualitative Analysis 111     Make Sure There Are No Analytical Gaps in the Development and Derivation of Growth Rates 115     Incorporating Prospective Information That Is Presented into Your Opined Results 119     Reporting Your Opined Results 126     Conclusion 129     Chapter 7: Reasonableness Tests 131     Determining Reasonableness 132     Example 1: Derived Estimate of Value 136     Example 2: Guideline Company Method 139     Example 3: Use of Market Multiples 144     Example 4: Federal Tax Compliance 145     Conclusion 146     Chapter 8: Enhancing the Integrity of Your Opinion 149     Understanding the Credibility Threshold 150     Understanding the Scope Undertaken 152     Understanding Analytical Responsibilities and the Impact of Matter/Cause/Effect Analysis 154     Conduct Your Analysis within the Parameters of the Economic Reality Relevant to the Facts and Circumstances 156     Maintain a High Level of Professional Skepticism and Engagement Awareness 157     Review Your Analytical Process for Relevance and Typical Common Errors 160     Be Ready to Respond to Ethical Challenges 162     Enhancing the Integrity of Your Opinion When at Trial or in Hearings 163     Enhancing the Integrity of Your Opinion When at Deposition 166     Conclusion 166     Chapter 9: Reviewing the Work of Others 169     Review Engagement Procedures to Consider 170     Preparing a Document Request for a Review Engagement 172     The Role to Be Assumed: Reviewing Expert or Reviewing Consultant 173     Limiting Conditions and Assumptions 174     Determining an Appropriate Scope for Your Review 175     Minimum Scope Considerations in a Review Engagement 177     Conclusion of a Business Appraisal Review Engagement 177     Business Appraisal Review Opinion 178     Reviewer   s Independence 182     Common Errors and Analytical Gaps Found in Valuation Reports 183     Conclusion 188     Chapter 10: The Journey Continues 189     Definition of Credibility 189     Attributes Attached to a Credible Opinion 190     Separating Decision Making from Opining 192     A Note on Generally Accepted Principles and Practices 193     A Definition of the Concept of Informed Judgment 193     Suggestions for Assessing Your Own Methodology   the Importance of Reasonableness Tests 194     Suggestions for Enhancing the Integrity of Your Opinion 194     Conclusion 195     Appendix 197     About the Author 209     Index 211