July 24, 2017

Matrimonial business valuation and litigation support

At Greene Valuation, we provide a broad range of services related to matrimonial business valuation and litigation support.  We have served as both court appointed and agreed upon neutrals in these matters.  Frequently, our services will encompass valuation, financial forensics and tax services within a single engagement.

We can use forensic accounting techniques to uncover concealed assets, identify overstated expenses, value marital assets (including closely held shares of businesses and stock options), and to help minimize the tax consequences of divorce and the distribution of assets.

These services generally include:

  • Business valuation of operating businesses
  • Business valuation of professional practices and goodwill including medical and dental offices, law firms, accounting practice, etc.
  • Enhanced earnings capacity calculations of licenses and degrees
  • Analysis of undetermined asset in the statements of net worth
  • Active or passive appreciation of family businesses

Business valuation of operating businesses

Business valuation of operating businesses, whether for equitable distribution or other purposes, requires the specialized skills of trained valuation practitioners.  The methods used in equitable distribution frequently differ from other matters.  Sometimes a portion of the business’s value may be considered separate property requiring valuation at different dates or the appreciation in value may not be completely active. (See active or passive appreciation, below.)

Referring attorneys and other professionals consistently praise our reports on the acceptance of our findings, concise explanations of accounting and valuation methods and easy-to-read results.  (Contact us to discuss.)

Business valuation of professional practices and goodwill including medical and dental offices, law firms, accounting practices, etc.

Valuation of professional practices and goodwill can differ from operating businesses in that most of their value, like service businesses, centers around people. Much of their value is intangible in nature and rests with their goodwill.  However, unlike service businesses, professional practices provide specialized services, which often require that owners possess special expertise.

Unique aspects to valuing professional practices should be considered, including professional licenses, the individual professional, the nature of the client base and accounting policies.

Furthermore, goodwill valuation can vary across professional practices and it is imperative that goodwill be valued correctly.  Frequently, the same earnings stream can be used to value multiple aspects of the divorce.

Analysis of undetermined asset in the statements of net worth

Frequently we have been asked to estimate value of the other party’s assets, which are only identified, but not valued when the Net Worth statement is first available.  We can apply several models to estimate their value early in the process.

Active or passive appreciation of family businesses

The increased value resulting from spousal efforts (active appreciation) becomes the property of the marital partnership, while increased value attributable to other sources (passive appreciation) remains separate property.

Divorce attorneys representing a business owner are particularly interested in clearly separating the growth in business value during the marriage between growth attributed to efforts of a spouse (active) and to external factors and market forces (passive).  We can model external factors that can influence the growth of a business.

More services

Other litigation includes dissenting and oppressed shareholder/member actions, owner buyouts, and commercial litigation claims.

Stock option valuation including options, junior rounds of equity and the fair values of employee share options and similar instruments.