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Day 2 – Premise of Value: An Attorney’s Guide to Understanding Business Valuation

In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb gives a detailed look at several different premises of value that you’re likely to see, as an attorney.

Episode Highlights:

  •  Mark gives an overview of the different categories of premise of value. (0:25)
  •  What’s the most common type of premise of value you’ll see as an attorney? (0:40)
  •  Mark lists attributes you must consider when dealing with ‘going concern’. (0:45)
  •  What’s the difference between an orderly liquidation and a forced liquidation? (1:15)
  •  When is in-use/in-exchange used? (2:00)
  •  What four things must you consider when selecting the proper premise of value? (2:10)

Key Quotes:

  • The different premises of value that you’ll probably see as an attorney are going concern, value in use, highest & best use, in-use/in exchange, and liquidation.” – Mark S. Gottlieb
  • “In an orderly liquidation, the assets are sold within a reasonable time to maximize value. In a forced liquidation, the assets are sold quickly, almost like an auction style.” – Mark S. Gottlieb
  • The value in use is what is commonly seen in real estate appraisals. The highest & best use is commonly used when we have the use of an asset by the market participants that maximizes their value.” – Mark S. Gottlieb

Resources Mentioned: