Vendor Fraud: A Continuing Threat

  |  August 14, 2017

Vendor fraud continues to be a major threat to organizations. In fact, vendor, supplier and procurement fraud is the second most prevalent fraud, according to the 2016-2017 Kroll Global Fraud Annual Report.

Who is the most at risk from vendor fraud? Read more. Read More

The Importance of the Insured’s Finances on First-Party Claims

  |  July 26, 2017

Two principal questions serve to illustrate the financial issues that may confront carriers in handling a first-party claim. First, so-called time element losses such as business interruption, loss of use, and additional living expense claims highlight the importance of understanding the insured’s on-going operations for purposes of evaluating the value of a loss.

Second, a discussion of questionable or even fraudulent claims illustrates how a complete understanding of the insured’s finances can identify red flags and, potentially, proof that the insured has overstated their claim or had a motive to commit arson or stage the theft of goods, services, and materials related to their business. We begin, therefore, with a discussion of those two issues as they arise under common first-party claim situations. Read more. Read More

Occupational Fraud Is a Worldwide Problem

  |  June 28, 2017

Over the years, I have been invited to speak to various groups, and in a variety of venues, on the topic of employee theft—or, as the Association of Certified Fraud Examiners (ACFE) likes to call it, Occupational Fraud. In June, I had the opportunity to speak again on this subject, this time in London, U.K.

For my visit to the United Kingdom, I made use of this international data which shows a significant amount of consistency with results from the U.S., and a few surprises. Read more. Read More

Proposed Regulations May Limit Valuation Discounts for Estate and Gift Transfers

  |  August 28, 2016

In our Summer 2015 Valuation & Forensics newsletter, we reported that "Valuation Discounts on Certain Transfers May Soon Be Limited," and one year later, it appears this may finally come to pass. In early August 2016, the IRS proposed new regulations that are designed to limit valuation discounts in intra-family transfers of ownership interests in corporations, partnerships, limited liability companies and family limited partnerships. Read more. Read More

Quality of Earnings: Important Considerations for Buyers and Sellers

  |  April 27, 2016

When it comes to evaluating “quality,” buyers, sellers and, most importantly, financial institutions, often have widely diverse opinions, that can greatly affect their decision to proceed with a particular transaction.

Nobody likes surprises. All parties involved spend considerable time and energy just to get to a proposed transaction. In evaluating the quality of earnings, the elements that always receive significant attention are the depth and breadth of the businesses’ key customer/vendor relationships; repeatable business processes that are executed daily without exception; and the strength of key staff beyond the owner(s). Read more. Read More

The Year in Review and What to Watch for in 2016

  |  February 9, 2016

Changes in interest rates, stock market values and economic and industry conditions can all impact the value of privately held businesses. In general, increases in the equity markets, lower interest rates and higher growth expectations – due to improving economic, industry or specific company expectations – point to higher values. Conversely, declines in the equity markets, rising interest rates and lower growth expectations may put downward pressure on values. In the coming year, business valuations could be impacted by a number of current events. Read more. Read More