Yearly Archives: 2008

Battle of the “Rules of Thumb” in North Dakota

June 01, 2008 | Blog, Business Valuation, Court Decisions, Divorce

Icon for author Brian Vertz Brian Vertz

In Evenson, a recent decision of the North Dakota Supreme Court, the business which was implicated in a divorce action was an insurance agency. The business owner sold multi-peril crop insurance through local banks for which the owner had previously worked. Both valuation experts agreed that insurance agencies are generally valued by applying a multiplier to the agency’s gross commissions over a period of time. The wife of the insurance […]

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WV Looks at Goodwill in Professional Practices

May 29, 2008 | Blog, Business Valuation, Divorce

Icon for author Brian Vertz Brian Vertz

The Supreme Court of West Virginia recently considered the enterprise goodwill of a professional practice in divorce proceedings in Helfer v. Helfer, 221 W.Va. 625, 656 S.E.2d 70 (November 2007). In Helfer, the business owner’s expert found that his chiropractic practice was worth $41,000, based on a capitalization of earnings. His wife’s expert found the practice to be worth $388,000 based on the excess earnings method. Neither of the experts […]

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Tax-affecting Can Influence the Development of Judicial Precedent

May 22, 2008 | Blog, Tax Issues

Icon for author Brian Vertz Brian Vertz

I may have mentioned this before on this blog, but it is striking to me how many accountants and valuational professionals regard court decisions as monolithic. At NACVA chapter meetings, I have heard CPAs say that “you must do this” or “you can’t do that” because of some court decision or IRS position. But we must not forget that all court decisions are, to some extent, fact-sensitive and case-specific. The […]

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Florida court declines to adopt “fair value” in Erp

May 16, 2008 | Blog, Business Valuation, Court Decisions, Divorce

Icon for author Brian Vertz Brian Vertz

A recent Florida divorce decision, Erp v. Erp, considered the valuation of an RV dealership acquired by the husband and wife during their marriage. The dealership was organized as a subchapter “S” corporation, of which the husband and wife each owned 40% of the stock. Husband’s son from a prior marriage and wife’s son from a prior marriage each owned 10% of the stock, so that no decisions could be […]

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