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Traps in valuations for tax purposes

Published on 01 Oct 13 by "THE TAX SPECIALIST" JOURNAL ARTICLE

This article identifies fundamental traps in valuations of specialised in situ assets for tax purposes and suggests ways to deal with them. These traps arise from using an incorrect unit of measurement, adopting an incorrect subject of valuation, misinterpreting financial statements as a statement of value, overlooking the evolutionary nature of asset value and the economic nature of goodwill, and dictating the assessment of goodwill value as a residual. Unfortunately, these traps have received little recognition in the public arena. The tax consequences from failing to recognise and deal with them are self-evidently significant.

Author profile:

Dr Hung Chu
Hung is a Director of Lonergan Edwards & Associates Limited. Dr Hung Chu completed his master degree in Finance and Banking (with Merit among the top 2% of graduates) from the University of Sydney and his doctoral degree in Finance from the University of Technology, Sydney (graduated on Chancellor's List for Exceptional Scholarly Achievement in PhD research). He has 12 years of experience in the provision of valuation services and numerous technical papers published in academic and practitioners' journals. Current at 01 June 2016 Click here to expand/collapse more articles by Hung CHU.
 
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