US Member: 

Log in


                GROWTH. TRANSFER. LEGACY.

Message or share this on LinkedIn:

Should you hire a Neutral Valuation Expert? By: Shelley Lombardo

  • November 26, 2019 10:17 AM
    Message # 8140061
    XPX Content (Administrator)

    The need for expert valuation services is increasing in today’s litigious environment. The valuation of closely-held business interests and related assets in the context of tax, corporate transactions and legal disputes is necessary to properly resolve matters and make key financial decisions.

    In contentious situations such as divorce or shareholder disputes, it is typical for the parties to hire two valuation experts; one for each side.  However, opposing parties may jointly decide, in consultation with their legal teams, to use a neutral valuation expert (NVE).   In this case, a neutral appraisal is completed for parties with opposing interests by an independent third-party appraiser or valuation expert.

    How can a neutral valuation expert assist you?

    1.   Reduce Financial Uncertainty and Suspicion – The NVE has the expertise to identify the necessary and appropriate data required to ensure full disclosure of all relevant financial information including, financial statements, tax returns, and other bank, investment and retirement plan account data. Trust increases when clients are comfortable that a complete financial picture has been presented and any questions have been asked and answered.

    2.   Provide Fair Access to Financial Information – Specifically, in a divorce setting, the NVE can alleviate the non-money spouse’s financial suspicions and concerns. In many cases, one spouse handles the family’s finances or holds equity interests in privately-held companies. A lack of familiarity with the family finances contributes to angst and uncertainty about the future. The NVE may educate the spouse who has not been intimately involved with the finances. The increased education and understanding diminishes some of the anxiety and concern.

    3.   Independent Opinion – Since the NVE is independent, the parties are more likely to reach an agreement. The NVE can help clients evaluate the various financial options under consideration and explain how those decisions impact both parties and the valuation outcome. Information about the implications of various terms from the NVE provides the parties with the confidence to make decisions and reach an agreement.

    Why choose the experts at Evergreen Advisors?

    1.   Many neutral valuation assignments are completed to reduce professional fees. Many firms do not provide the price and engagement flexibility that we are able to extend.

    2.   Our valuation professionals provide independent, defensible, and unbiased valuation opinions that can stand up to the highest levels of scrutiny from government regulators and the courts. We understand the necessary requirements that lead to our opinions being accepted by arbitrators and courts.

    3.   Evergreen’s experts have significant experience assisting parties in order to resolve controversies. When the underlying dispute is a financial or economic matter, a qualified appraiser is best able to provide reliable opinions and conclusions to help the parties reach a mutual agreement.

    Often a lot of money and court time is spent on competing valuation experts; each equally convinced their opinion of value is correct, leaving the decision of valuation to the trier of fact, who is left to interpret the valuation evidence and extract their own (often erroneous) opinion of value. This is a significantly more expensive, risky, and time-consuming process than agreeing to and hiring an NVE initially. Ultimately, hiring an NVE will save money and time, and lead to a more accurate and fair basis to divide equity interests and resolve disputes.

    Last modified: November 26, 2019 10:18 AM | XPX Content (Administrator)
Copyright XPX Global LLC | Terms-of-Use | Privacy-Policy