Check out Dan Korsman’s article featured in Minnesota Business Magazine. Summary: A family limited partnership offers many perks, including the ability to transfer wealth at substantial discounts from the fair market value of underlying assets. But without a valuation, this perk easily could become a liability.
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Dan Korsman (J.D., CPA/ABV) is an experienced professional in providing valuation and financial advisory services to mid-market companies and their owners. He has extensive experience in performing valuations for financial reporting purposes (business combinations, goodwill impairment and compensation expense) and for taxation purposes. He also performs valuation and litigation services for shareholder disputes, buy-sell agreements, divorces, succession planning and calculating damages.
Dan brings a breath of business experience in accounting, finance and law, having earned the CPA and ABV designations and passing the Minnesota bar.
“I enjoy performing valuations for financial reporting purposes. Each valuation is unique and brings together a mix of academic theory with real life information. I also enjoy assisting clients through the maze of accounting standards and best practices. My goal in any valuation is to make the whole process easier on management, so they can focus on issues that drive real value to their company.”
Areas of Expertise
Education + Credentials
J.D., University of Nebraska College of Law
B.S., Accounting, St. Cloud State University
Certified Public Accountant (CPA)
Accredited Business Valuation (ABV)
AICPA Forensic and Valuation Services Section
American Institute of Certified Public Accountants (AICPA)
Minnesota Society of Certified Public Accountants (MNCPA)
Fair value, is the standard of value used in over forty Accounting Standards Codification (“ASC”) topics. Some of the more commonly encountered topics that rely upon fair value are: ASC 350, Intangibles – Goodwill and Other ASC 360, Property, Plant and Equipment ASC 805, Business Combinations ASC 815, Derivatives and Hedging ASC 825, Financial Instruments … Continued
This article discusses the testing of long-lived assets for impairment under ASC 360-10. It should be noted that there are significant differences between the tests required for indefinite lived assets under ASC 350-30, long-lived assets under ASC 360-10, and goodwill under ASC 350-20. Performing these tests in the proper order is critical to concluding the correct amounts of impairment (if any).
For purposes of ASC 805, items within inventory need to be stated at fair value. Fair value is often greater than their book value as book value only includes historical costs and ignores the required return accruing to inventory as it progress through the value creation process. The process of stepping up inventory to fair value often results in a greater amount of COGS in the first post transaction period and can drastically lower the expected profit of the business on a GAAP basis. Management should be aware of this and its possible effects on earn outs or debt covenants.
In 2014 the Private Company Council and FASB approved new accounting alternatives for goodwill and intangible assets that can be elected by most private companies. The accounting alternatives were designed to lower the complexity and cost associated with meeting the current standards.
This article assumes use of the Black-Scholes formula (a closed-form model); as this is the method most private companies’ use. We will explain where the typical inputs for each of these six factors are found and in certain cases, how they can be modified to fit the facts and circumstances of a specific situation.
Early in my career I was often asked to assist auditors with reviewing in-house valuations of intangible assets acquired in business combinations. I often responded to these requests with a large sigh. Having been through this process before I knew many CFOs and controllers believed they could put together an intangible valuation. After all, many CFOs … Continued
FASB approved new accounting alternatives for goodwill and intangible assets that can be elected by most privately held businesses. This article highlights (1) some of the changes allowed under the accounting alternatives, (2) areas in which companies may find cost savings, and (3) some of the potential issues with electing the alternatives.