Forensic Perspectives

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb gives a quick recap of what we’ve learned in this miniseries, the types of scenarios in which this knowledge can be utilized and where you can find more valuable resources as a practicing attorney. Episode Highlights: Mark gives a recap of the categories that have been covered in this mini series. (0:20) As a firm that specializes in business valuation, what types of scenarios will you be retained in? (0:53) Where can you learn more about Mark’s firm and available services? (1:12) Mark outlines several resources found on his website that practicing attorneys can use. (1:30) Mark thanks the listeners and gives a closing statement. (1:42) Key Quotes: “As a firm that specializes in business valuation and forensic accounting, we are often retained in various instances. Some examples are divorce, shareholder disputes, insurance, manners, succession planning, gift an estate tax purposes.” - Mark Gottlieb “In addition to the seven days of seminars, our website also provides several resources that you as practicing attorneys can use. Pay close attention to the podcast, blogs, white papers, our expert page, as well as our resource page that provides checklists and questionnaires.” - Mark Gottlieb Resources Mentioned: Mark S. Gottlieb, CPA, PC (MSG) Reach out to Mark S. Gottlieb

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb lays out the important factors to remember when determining your valuation method. Follow along as Mark walks us through mock scenarios to explain how to properly weigh various approaches. Episode Highlights: Mark recaps different methods discussed in the miniseries when it comes to valuing a business. (0:20) How do you ultimately determine which methods should be used? (0:35) Mark explains how to weigh each approach when more than one method is applied. (0:50) Mark shows a mock scenario example of how to weigh value equally. (1:15) How does the valuation of a business change when you weigh one approach more than the other, instead of equally? (1:50) Key Quotes: “We have examined the three different methods of our approaches to valuing a business: there was the asset, the market and the income approach. When you’re all said and done, the expert has to determine what methods are going to be used.” - Mark Gottlieb “In some instances, only one method. But when two or more methods are being used, the appraiser has to determine what weight each method is going to be applied.” - Mark Gottlieb “When reconciling the valuation conclusions, you have to pay close attention to the weight of each of the methods that have been employed.” - Mark Gottlieb Resources Mentioned: Mark S. Gottlieb, CPA, PC (MSG) Reach out to Mark S. Gottlieb

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb gives us an overview of how valuation discounts are used in business valuation, and a detailed look at two primary types: DLOC and DLOM. Episode Highlights: What are the two primary types of valuation discounts? (0:20) What four components is DLOC dependent upon? (0:30) Mark discusses investor’s control expectations and control prerogatives. (0:55) How do we quantify DLOC? (1:10) What is a discount for lack of marketability? (1:25) Mark breaks down how a sample valuation would be computed. (2:55) Key Quotes: “Control generally has certain prerogatives with it. Some of these are the rights to appoint management, to pay dividends, to direct business strategy, to set compensation and to divest assets.” - Mark Gottlieb “Marketability is defined as the ability to convert the investment or the business into cash. And generally, that conversion happens in three days or less.” - Mark Gottlieb “Often when we're evaluating a controlling interest, we either will not take a discount for marketability, or take a rather modest discount when compared to what would have been used if a minority interest would have been calculated.” - Mark Gottlieb Resources Mentioned: Mark S. Gottlieb, CPA, PC (MSG) Reach out to Mark S. Gottlieb

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb gives insight into one of the most important parts of your business valuation: financial statements. Which issues should you pay close attention to and what are some real life examples you should be aware of? Listen to find out! Episode Highlights: Mark explains one of the most important parts of your business valuation approach. (0:25) What are appraisers trying to determine when they review five years worth of financial statements? (0:33) What issues do you have to consider when fine tuning your financial statements? (0:50) Mark gives an overview of five types of adjustments. (1:00) Mark gives a few examples of circumstances that could alter unusual & nonrecurring adjustments. (1:15) Mark lists non-operating assets that are commonly used. (1:35) What is a specific example of a non-operating asset? (1:50) Mark gives an overview of types of related party transactions. (2:15) Which types of accounting norms should be considered? (2:40) Key Quotes: “Valuation by itself is a difficult exercise. And, one of the most important parts of the approach is to normalize the financial statements that you're provided.” - Mark Gottlieb “We also have to consider non-operating assets. These non-operating assets commonly include items such as real property, investments, or other types of excess assets.” - Mark Gottlieb “An example of an non-operating asset may be excess inventory, or it may be a piece of real estate, or a plane or some other type of asset that is on the books of the business, but has no functioning or operating value to the business.” Resources Mentioned: Mark S. Gottlieb, CPA, PC (MSG) Reach out to Mark S. Gottlieb

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb gives a detailed look at three general business valuation methods and how they’re used. Episode Highlights: Mark gives a general overview of 3 evaluation methods. (0:20) When is the asset approach normally utilized? (0:35) Mark mentions a key component you must remember when dealing with a market approach. (1:05) What is the most common approach used in business evaluation? (1:40) Which factors should you pay close attention to when using a market approach? (1:55) Key Quotes: “The asset approach is defined as a difference between the normalized assets less than normal normalized liabilities. The asset approach is commonly use for real estate or holding companies.” - Mark Gottlieb “Even though you find similar industry participants, you still have to look to see if the financial attributes of the subject company have some symmetry with those companies that are bought and sold, that are in your database of the transactions you're examining.” - Mark Gottlieb “When we look at the income approach, there are certain things that we have to pay close attention to. The normalized income stream, the expected growth, the risk, industry wide factors, and company specific factors.” - Mark Gottlieb Resources Mentioned: Mark S. Gottlieb, CPA, PC (MSG) Reach out to Mark S. Gottlieb

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb gives a detailed look at several different premises of value that you’re likely to see, as an attorney. Episode Highlights: Mark gives an overview of the different categories of premise of value. (0:25) What’s the most common type of premise of value you’ll see as an attorney? (0:40) Mark lists attributes you must consider when dealing with ‘going concern’. (0:45) What’s the difference between an orderly liquidation and a forced liquidation? (1:15) When is in-use/in-exchange used? (2:00) What four things must you consider when selecting the proper premise of value? (2:10) Key Quotes: “The different premises of value that you'll probably see as an attorney are going concern, value in use, highest & best use, in-use/in exchange, and liquidation.” - Mark S. Gottlieb “In an orderly liquidation, the assets are sold within a reasonable time to maximize value. In a forced liquidation, the assets are sold quickly, almost like an auction style.” - Mark S. Gottlieb “The value in use is what is commonly seen in real estate appraisals. The highest & best use is commonly used when we have the use of an asset by the market participants that maximizes their value.” - Mark S. Gottlieb Resources Mentioned: Mark S. Gottlieb, CPA, PC (MSG) Reach out to Mark S. Gottlieb

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb gives us insight on the five areas of standards of value and shares the important roles they play in business valuation. Episode Highlights: Mark gives an overview of the categories associated with standards of value. (0:30) How is fair market value defined? (0:47) As an attorney, what attributes to fair market value do you need to be familiar with? (1:05) How does the definition of “fair value” vary by state? (1:40) In what context is synergy value most commonly utilized? (2:15) What important issues do you have to consider when addressing synergy value? (2:25) What factors are most important when it comes to investment value? (3:15) What is intrinsic value? (3:40) Key Quotes: “The standards of value that you may be familiar with, are fair market value, fair value, synergy value, investment value, and intrinsic value. Today, we're going to look very quickly at each one of these different standards.” - Mark S. Gottlieb “The definition of fair value actually does change from state to state. So, it's really important for you, as the attorney, to determine what the statute says, where you're practicing.” - Mark S. Gottlieb “What are the things that are important in investment value? There's investment goals, investors specific criteria, and rate of return. There's also other issues, such as strategy. And, these things are very, very specific to the seeker of valuation exercise.” - Mark S. Gottlieb Resources Mentioned: Mark S. Gottlieb, CPA, PC (MSG) Reach out to Mark S. Gottlieb

The demand for accountants with a forensic specialty has significantly increased in recent years. The growth of forensic practices is, in part, linked to the necessary determination of economic damages. In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb discusses the most common methods used to determine economic damages. Episode Highlights: Mark mentions the late JD Salinger, the author of the 1951 classic, Catcher in the Rye. (00:50) Mark shares why a business can be devastated financially. (2:12) Mark mentions one of the four common methods used in measuring damages. (3:38) Mark shares what the economic damage investigations can cover. (4:09) Mark shares the three core components in determining economic damages to financial experts’ calculations. (4:47) Mark mentions the responsibility of a forensic accountant. (5:41) What is required from the economic damage expert by the attorney? (6:02) Mark shares the methodologies of forensic accountants. (7:00) Key Quotes: “Preparing economic damage estimates requires a deep understanding of accounting principles and an acute understanding and knowledge of the subject business.” - Mark S. Gottlieb “No matter what the nature of the case. In the end, it's all about great detective work and accurate analysis. Attention to detail, as many you know, can make or break a case.” - Mark S. Gottlieb “It is my firm belief that the economic analysis and function of the forensic accountant should be able to demonstrate several different ways to approach a problem. Based upon my years of professional experience, I think the simplest approach is often the best.” - Mark S. Gottlieb Resources Mentioned: FINRA Reach out to Mark S. Gottlieb

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb discusses the three types of risk often considered in a business valuation analysis: Business Risk, Financial Risk, and Liquidity Risk. Episode Highlights: Mark mentions why the $4 billion acquisition of Marvel enterprises by The Walt Disney Company was one of the major business stories in 2009. (00:55) Mark explains how the income approach and business valuation are computed. (2:12) Mark mentions the factors that should be considered, such as risk. (3:10) Mark shares the three risk disciplines and their analysis. (3:31) Mark mentions the most subjective portion of the capitalization rate computation. (5:33) Mark mentions one of the most common mistakes they see in the analysis. (6:28) Key Quotes: “In a publicly held business, an investor’s interest is liquidated after the execution of a sell order, this investment is generally converted into cash within a couple of days, and liquidity and interest are non-existent.” - Mark S. Gottlieb “The valuators ability to articulate the pros and cons of the subject company's industry. The advantages and disadvantages of the subject company's business and the analysis of the subject companies financial components becomes an integral part of the valuation report.” - Mark S. Gottlieb “Be cautious when you're reviewing a valuation analysis to ensure that the risk interpretation is also not contained in other components of the valuation model.” - Mark S. Gottlieb Resources Mentioned: FINRA Reach out to Mark S. Gottlieb

Prenuptial agreements have become increasingly common to those in all income levels. In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb identifies the financial considerations attorneys should contemplate when preparing what many call the most unromantic document ever written. Episode Highlights: Mark mentions the classic film, Gone with the Wind. (1:02) Mark discusses why the preparation of a prenuptial agreement has become increasingly common for those of all income levels. (1:39) Mark shares where prenuptial agreements are commonly used. (2:31) Mark explains the five significant financial concepts and concerns that matrimonial and family law practitioners need to consider when preparing such agreements. (3:16) Mark mentions what the KISS principle stands for. (4:56) Mark shares a checklist of objectives to assist the matrimonial and family law attorney. (5:16) Key Quotes: “Prenups today are commonly used by couples of many economic brackets. In short, discussions about money and other financial issues are essential for those planning to marry.” - Mark S. Gottlieb “Keep It Simple Stupid (KISS) is an effective tool to communicate the financial desires of a separating party. It goes without saying, but it's worth repeating, that both parties must agree to the goals of their prenuptial agreement, so to avoid any unnecessary conflicts in the future.” - Mark S. Gottlieb “There is no dispute that marriage is an economic partnership and as in many legally binding relationships, the termination of marriage requires setting aside emotions and establishing a well thought out financial plan.” - Mark S. Gottlieb Resources Mentioned: FINRA Reach out to Mark S. Gottlieb

In this episode of the Forensic Perspectives podcast, host Mark Gottlieb, interviews Andrew Silfen, the Managing Partner at Arent Fox. Andrew talks about the economic impact of COVID, the disconnect between the economy and the market and the importance of taking a micro approach to business. Episode Highlights: What’s the main issue that Andrew can point to that has been currently adding to the strife of businesses? (2:19) Andrew shares the disconnect between the economy and the market. (5:09) Andrew shares why people should take a micro approach rather than a macro approach when it comes to business. (8:18) Andrew shares what PPP is all about. (13:06) Does Andrew think that the government will come out with a different type of program to assist? (16:16) Does Andrew have a checklist for his clients to assess where they are? (18:19) Andrew talks about the often overlooked subchapter five. (23:44) Andrew mentions the tragic outcome of the pandemic, from an economic perspective. (31:23) Key Quotes: “What you see is the large companies that have the ability to access tools, bankruptcy, finance, restructuring advisors, to make changes, to position themselves to ride through this and to come out the other side even stronger. So it's sort of is an inconsistency in the economy, and a complete lack of correlation between the market economy and business.” - Andrew Silfen “It's best to get your accountant, your financial advisor. You turn around the person, you've a restructuring lawyer in place to guide you, and help you as best you can. After that, you have to look at it yourself, and almost play war games in your business.” - Andrew Silfen “There's no reason to believe that we can't get out of all this, it's going to be hard. But what you can say to your clients, and the lawyers that are listening to this is inactivity is the worst thing that you can do. You know, you’ve got to have strategic planning, strategic action for your clients with the right advisors and taking the right steps if you want to be viable and survive.” - Andrew Silfen Resources Mentioned: FINRA Reach out to Mark Gottlieb Andrew Silfen LinkedIn Arent Fox