Valuation purpose and Applicable Standard Of Value

Question 1

Inheritance tax

Answer 1

Fair market value (FMV)

Question 2

Ad valorem taxes

Answer 2

Fair market value (FMV)

Question 3

ESOPs

Answer 3

Fair market value (FMV)

Question 4

Financial acquisitions

Answer 4

Fair market value (FMV)

Question 5

Dissenting stockholder actions

Answer 5

Legal fair value. In most states

Question 6

Corporate or partnership dissolutions under minority oppression statutes

Answer 6

Legal fair value in most states

Question 7

Going private

Answer 7

Legal fair value in most states

Question 8

Strategic acquisition

Answer 8

Investment value

Question 9

Buy-sell agreements

Answer 9

Anything the parties choose to agree on

Question 10

FASB Compliance

Answer 10

Accounting fair value

Question 11

Gift and estate tax

Answer 11

Fair market value (FMV)

Question 12

What is the accounting fair value definition?

Answer 12

The price that would be received to sell an asset or paid to transfer a liability in an orderly traction between market participants at the measurement date

Question 13

What is the legal definition of fair value?

Answer 13

Sellers often believe they are being forced to receive less than adequate consideration for their stock. In addition, buyer may not be compelled but seller is. Applies to minority blocks. Seller may not have equal and adequate knowledge at buyer.