Selecting a Qualified Business Valuation Expert For A Minority Oppression Case

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I often tell clients that selecting a qualified expert maybe more important that selecting a well qualified attorney who knows how to represent oppressed minority shareholders. An expert is usually required to provide opinion testimony as to the “fair value,” of the subject company. Often, that is the central issue in minority oppression litigation. Before an expert is permitted to provide opinion testimony as to the value of the company, they must possess the education, training and experience to render the opinion. Business valuation experts often have various designations.

 

This blog post will provide a quick overview of those designations.

  • Certified Public Accountant (CPA) While it is helpful to retain a CPA, that designation alone may not be enough to qualify as a business valuation expert. That is because the CPA examination does not focus on business valuation.
  • Accredited in Business Valuation (ABV) This is a person who has been certified by the American Institute of Certified Public Accountants. A person with the ABV designation has demonstrated to the AICPA that they have the knowledge and experience to value businesses. This designation is achieved by passing a test.
  • Accredited Senior Appraiser (ASA) This is a designation given by American Society of Appraisers.  Because the American Society of Appraisers certifies a number of valuation disciplines, it is important that the correct discipline is chosen for the engagement.
  • Certified Business Appraiser (CBA)  This is a designation created by the Institute for Business Appraisers.  This is a good designation. A person who has this designation must pass a test, complete a course, have an advanced degree and perform business appraisals.
  • Certified Valuation Analyst (CVA) This is a credential created by the National Association of Certified Analysts. Often experts will combine the CVA designation with other designations. 

Scott Unger is a Shareholder in Stark & Stark's Lawrenceville, New Jersey office concentrating in Shareholder & Partner Dispute Litigation. For questions, or additional information, please contact Mr. Unger.

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