Winter 2010

Useful Life Valuations of Intellectual Property
Intellectual property generally encompasses patents, trademarks, copyrights and trade secrets. When a situation arises that involves the need to value one of these types of intangible assets, the concept of "remaining useful life" is commonly used by valuation experts as a solid starting point. Remaining useful life is generally defined as the remaining period over which intellectual property is expected to contribute to the owner's future cash flow. It is used in the three primary techniques for valuing identifiable intangible assets, including intellectual property rights. Read more...

Business Valuations for Divorce Purposes
State law can be a critical factor when determining the value of certain assets in a divorce proceeding. This is particularly true when valuing a business--especially where goodwill is a key ingredient. Personal or celebrity goodwill, as the name suggests, relates to and is derived from a particular individual's association with a business or entity. Commonly understood to be the individual's reputation, the personal goodwill of a business owner adds value to a company, as in the case of a highly regarded attorney who is an equity partner in his or her firm. Read more...

Experts Everywhere
Appraisers specialize in virtually every type of asset. Which type of expert witness should you use in certain cases Valuation experts generally focus on valuing a particular type of asset--jewelry, artwork, machinery and equipment, personal property, real estate and businesses--for example. A valuation expert should generally limit appraisals to the discipline(s) in which his or her expertise exists. Beyond that area of expertise, an appraiser will generally recommend other individuals with the relevant skills. Read more...

Getting Back On Your Feet
The loss of a major client can be devastating to your practice. Perhaps a client-company's reorganization or bankruptcy was the event that precipitated such a loss. Regardless of the cause, the result can be a substantial and sudden shrinkage in your firm's revenues. Unfortunately, cutting attorneys, support staff or possibly both are potential solutions to offset reduced revenue stemming from the loss of a major client. Read more...

Textron Update: First Circuit Holds Workpapers Not Protected
In a highly anticipated en banc rehearing on the matter, the First Circuit Court of Appeals has held that the work product privilege does not extend to a corporation’s "tax accrual workpapers." The appeals court had previously vacated its own decision that upheld the determination that the work product privilege extends to tax accrual workpapers. In its latest decision, however, the appellate court ruled that the work product privilege relates to work done in anticipation of litigation, not in preparation of financial statements. In a 3-2 decision, a majority of the court found that the workpapers at issue were prepared to support financial filings and gain auditor approval, not in preparation for litigation. The aim of the privilege, the court reasoned, was to protect and help counsel in preparing for litigation, not to protect a lawyer preparing corporate documents or other materials in the ordinary course of business (U.S. v. Textron, Inc. (CA-1, 8/13/2009)).

Somerset Litigation, Valuation & Forensic Team News

What We Do - When you are determining which independent consulting firm to select for litigation support, we ask that you consider Somerset. You can rely on our experience, competency and reputation. Over the years, we have been involved in many complex litigation matters, valuations and financial investigations involving breach of contract damage assessments, asset misappropriation, fraudulent financial reporting, business valuation claims and damages resulting from post-acquisition disputes. We regularly perform complex financial analysis, financial modeling, cost analysis and business valuation services in a wide variety of industries. Utilizing qualified and credible litigation support professionals--who can get key points across in an understandable manner--is critical to prevailing in your cases. Your clients are also looking to you to contain costs, and we can provide real value with our reasonable and cost-effective rates. Please contact us today.

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In Other News - Somerset publishes a variety of newsletters in addition to Litigation Support--such as Employee Benefit Plan Commentator, Wherewithal, Real Estate Focus, Tax Times (including recently published Tax Planning Letters for Individuals and Businesses) and several others. Please visit the Newsletters page of our web site to read the archives and sign up to have new issues delivered to your email inbox.
 

This newsletter is provided by Somerset CPAs for our clients and other interested persons upon request. Since technical information is presented in generalized fashion, no final conclusion on these topics should be made without further review. For additional information on the issues discussed, please contact Steve Riddle, Tom Thieme, Rex Collins, Ken Stalcup or Doug Ayres of our Litigation, Valuation & Forensic Team.

This document is not intended or written to be used, and cannot be used, for the purpose of avoiding tax penalties that may be imposed on the taxpayer.