Willamette Perspectives

July 2023 Perspectives Cover

July 2023

Editor for this issue: Timothy J. Meinhart, Managing Director and Leader of Shareholder Litigation Valuation Services Practice of our firm in our Chicago office.

Understanding the Implications of Cecil v. Commissioner

Grant Crum

In Cecil v. Commissioner, the U.S. Tax Court was faced with a dispute involving the valuation of a noncontrolling interest in a privately held S corporation. The valuation experts retained by the taxpayers and the Internal Revenue Service tax-affected the earnings of an S corporation and applied the S Corporation Economic Adjustment Multiple, even though both analyses had not been generally accepted by the Court. The ruling provides valuation analysts with guidance about valuing a noncontrolling interest in S corporation stock.

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How to Properly Use Asset Transactions in the Guideline Merged and Acquired Company Method

Tia R. Hutton and Lisa H. Tran

In utilizing the guideline merged and acquired company method to estimate a value for a closely held company, particularly a smaller business, the valuation analyst typically will find more transactions of private guideline companies than publicly traded companies. Most transactions of small, private companies are structured as asset sales. Although both asset sales and stock sales can be used to develop a value indication for a subject company, it is inappropriate to combine the transactions without making proper adjustments. Assets sales and stock sales are different transaction structures, and the transaction price often reflects the transfer of different assets and liabilities, which will have a direct effect on the pricing multiples used to value the subject company.

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Getting the Most out of Every Engagement

Timothy J. Meinhart and Marc D. Bello

Marc Bello has joined Willamette Management Associates in the midst of a distinguished 20-year career in business valuation and forensic analysis. For Bello, success stems from many skills, but particularly important are education, personal development, and integrity. Understanding the financial landscape is crucial to business valuation and forensic analysis because it leads to proper questions that produce the necessary documents essential for a supportable result. Additionally, incorporating a wholistic approach that analyzes industry and nonfinancial data leads to a supportable valuation. Finally, clear communication creates understanding between an analyst and a client throughout an engagement.

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Willamette Insights and Perspectives Back Issues

April 2023 Perspectives

Editor for this issue: Charles Wilhoite and Scott Miller

April Perspectives cover

Winter 2023: Best Practices

Editor for this issue: Robert F. Reilly, CPA

Willamette Management Advisors Winter 2023 Insights

Transfer Tax Valuation Thought Leadership

Damages Measurement Thought Leadership

Property Appraisal Thought Leadership

Fair Value Measurement Thought Leadership

Valuation, Damages, and Transfer Price Thought Leadership

Reasonableness of Compensation Analysis Thought Leadership

Autumn 2022: Thought Leadership in Wealth Transfer Valuation Issues

Editor for this issue: Weston C. Kirk

Willamette Management Advisors Autumn 2022 Insights

Estate and Gift Tax Planning Thought Leadership

Income Tax Thought Leadership

Bankruptcy Thought Leadership

Summer 2022: Thought Leadership in Professional Practices and Licenses Valuation, Damages, and Transfer Price Analyses

Editor for this issue: Samuel S. Nicholls

Willamette Management Advisors Summer 2022 Insights

Professional Practice Valuation, Damages, and Transfer Price Thought Leadership

Professional Practices and Licenses Valuation Thought Leadership

Income Tax Thought Leadership

Winter 2022: Thought Leadership in Unit Valuation Principle Property Tax Appraisals

Editors for This Issue: Connor J. Thurman and John C. Ramirez

Willamette Winter 2022 Insights Cover Page

Intellectual Property Valuation

Federal Income Tax Thought Leadership