Autumn 2012
Focus on Intangible Asset Valuation
Editors for This Issue: Robert F. ReillyIntangible Asset Valuation Insights
The Cost Approach and the Intangible Asset Valuation Assignment
Kyle J. Wishing and Robert F. Reilly, CPA
The cost approach is particularly applicable to certain types of intangible assets and for
certain types of intangible asset valuation engagements. This discussion summarizes (1)
the
many reasons to value intangible assets and (2) the many types of commercial intangible
assets. And, this discussion summarizes the common elements of the intangible asset
valuation engagement.
Intangible Asset Valuation Approaches and Methods
Brian P. Holloway and Robert F. Reilly, CPA
The cost approach is particularly applicable to certain types of intangible assets and for
certain types of intangible asset valuation engagements. This discussion summarizes (1)
the
many reasons to value intangible assets and (2) the many types of commercial intangible
assets. And, this discussion summarizes the common elements of the intangible asset
valuation engagement.
Confirming the Cost Approach
Intangible Asset Value Indication
Adriana A. De La Mora and Robert F. Reilly, CPA
The cost approach is applicable to the valuation (1) of many types of intangible assets
and (2) of intangible assets that operate in many industries. However, before reporting
the
cost approach value conclusion, the valuation analyst will typically attempt to confirm
the
value indication. This discussion summarizes value indication confirmation procedures.
This
discussion also presents several illustrative examples of intangible asset valuations.
Procedures Companies Can Use to
Maximize the Value of Their Intellectual Property
Justin M. Nielsen and Robert F. Reilly, CPA
Valuation analysts can work with company senior management to more effectively use their
intellectual property assets. The valuation analyst can document, inventory, and value
all of
the company’s intellectual property. This discussion presents ten practical procedures
that
companies can use to benefit from the value of their intellectual property.
Thought Leadership:
Forensic Analysis of Intangible Asset Damages
Robert P. Schweihs and Robert F. Reilly, CPA
Intangible assets are often the subject of breach of contract disputes and tort
disputes. In
such claims, the intangible asset owner/operator typically attempts to prove that it
suffered
economic damages due to the defendant’s wrongful actions. This discussion summarizes
the generally accepted approaches, methods, and procedures related to the measurement of
intangible asset economic damages.
Bankruptcy Insights
Income Tax Considerations Related to the Abandonment, Foreclosure, or Repossession
of Collateral Property
Urmi Sampat and Robert F. Reilly, CPA
Financially troubled debtors (both corporate and individual) have to face difficult
decisions
when they cannot honor their debt obligations. For a secured loan, the alternative may
be that the debtor will either abandon the collateral property, go through a foreclosure
proceeding, or have the collateral property repossessed. As if these events were not bad
enough, there are often negative income tax consequences to the debtor related to these
alternatives. This discussion summarizes the income tax consequences related to a
collateral
property abandonment, foreclosure, or repossession.
Income Tax Consequences of Debt
Modification
Kevin M. Zanni and Robert F. Reilly, CPA
Debt restructurings are common among financially troubled debtor corporations. And, debt
restructurings are common among corporations within bankruptcy protection. However,
debt restructurings can have unfavorable income tax consequences to the debtor, the
creditor, and the third party holding the debt instrument. This discussion summarizes the
income tax consequences that all parties should consider in a corporate debt modification.
ESOP Valuation Insights
Best Practices:
Valuation Considerations in the Sale of Employer Corporation Stock to an ESOP and to
Other Parties
Chip Brown, CPA, Steve Whittington, and Robert F. Reilly,
CPA
Sometimes close corporations sell common stock at the same time to an employee stock
ownership plan (ESOP) and to a non-ESOP investor. In such an instance, for many reasons,
the values (i.e., prices) of the two blocks of stock may not be the same. This discussion
summarizes the different considerations between (1) valuing employer stock for an ESOP
purchase transaction and (2) valuing employer stock for a non-ESOP purchase transaction.