Arxis Financial Litigation Consulting Update e-newsletter

September 2010

Feature Article:

"Succession Planning Options for Family-Owned Businesses"

Of all the assets that make up an estate, the most complex and valuable is often the closely-held business. The business represents a lifetime of effort and the source of wealth, income, and great satisfaction. Once the general value of a business is determined, the succession planning process can proceed. Depending on the specifics of each situation, including goals of the owner, there are several options for implementing a succession plan … (click here for complete article)

"Insights on Valuation" -- 3rd Quarter, 2010 Issue

We are pleased to include our quarterly newsletter "Insights on Valuation." In this issue, we discuss:

"What is Fair Value?": In performing a valuation of a business the starting point is identifying and defining the standard of value that will apply based on the facts and circumstances surrounding the engagement. Fair Value is commonly used in dissenting shareholder litigation. As a judicially mandated concept, it is subject to court interpretation and varies from state to state.

"What is Fair Market Value?": Fair Market Value is the standard of value applicable to the most business valuation projects for divorce court, estate and gift taxation, accounting, and many private transactions. The definition of Fair Market Value for business valuations comes from Revenue Ruling 59-60 published by the Internal Revenue Service. The definition originated in the tax law, but it has become the applicable definition of value for nearly all venues:

"Rules of Thumb—It’s Not That Simple": Reducing the complexity of business valuation to rules of thumb is an appealing proposition. Avoiding complex cash flow calculations and side stepping necessary adjustments makes the process of valuation more appealing and more accessible to the lay user. However, one must still deal with the dilemma: “Should it be done simply because it can be done?” Is there value in the simplicity of rules of thumb?

Practice Profile

Litigation Consulting Services for Wrongful Death

Whether for plaintiff or defense counsel, wrongful death matters hold significant financial consequences. Loss calculations can easily reach into the multi-million dollar range based on an individual's earnings, fringe benefits and inheritance, as well as damages for mental anguish or pain and suffering of the survivors, and possible punitive damages. Hiring the right expert in such matters is therefore an imperative.

Arxis Financial is thoroughly equipped to offer extensive litigation consulting services in wrongful death cases. We provide an independent analysis of damages, using current market data, national estimates and case specific facts. We also provide analysis of opposing expert’s reports, especially when the calculated loss appears to be overstated. Our experts review the underlying assumptions and methods, verify accuracy of their calculations, and compare these to professional standards. We can also provide questions for cross examination of the opposing damages expert. Our expert analysis can often provide a basis for negotiating a reasonable settlement.

Our experts are readily available to attest to their findings in depositions and trial at local, state and federal court levels as well as mediation and arbitration. Clients are pleased with Arxis Financial’s abilities to clearly, persuasively, and accurately present economic and financial evidence and opinions.

Partner Profile:
The Litigation Consulting practice is headed by partner Chris L. Hamilton, CPA, CFE, CVA, DABFA. Mr. Hamilton is a Certified Public Accountant, Certified Fraud Examiner, Certified Valuation Analyst, and a Diplomate with the American Board of Forensic Accounting. He is a licensed life and disability insurance agent and a General Securities Representative. Mr. Hamilton has published articles in several publications, and has made presentations at national conferences, training institutes and seminars on topics including forensic accounting, fraud and business appraisal.

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Litigation Consulting

Update

Forensic Accounting - Fraud - Business Valuation