Advanced D P Chapter Five Review Questions
Advanced Discounts and Premiums
CURRENT JUDICIAL DEVELOPMENTS
ADVANCED DISCOUNTS AND PREMIUMS CHAPTER 5 REVIEW QUESTIONS
© 2003–2014 Robert J. Grossman and National Association of Certified Valuators and Analysts 2014.v1
Chapter Five – 17
CURRENT JUDICIAL DEVELOPMENTS
Advanced Discounts and Premiums
ADVANCED DISCOUNTS AND PREMIUMS CHAPTER REVIEW QUESTIONS Chapter 5: Current Judicial Developments Affecting Control Premiums and Minority Discounts 1.
Which court case potentially abused its discretion with its decision—disallowing the application of both a minority and a marketability discount? a. b. c. d.
2.
Which case rejected the methodology of using premium studies? a. b. c. d. e.
3.
Estate of True v. Commissioner HMO-W v. SSM Health Care System Maggos v. Commissioner Gow v. Commissioner Bonner v. United States
In Estate of True v. Commissioner, the IRS argued that the minority interests represented swing votes and, therefore, would not be subject to a minority interest discount—this position was upheld by the court. a. b.
4.
Estate of Joseph Cidulka Ferraro v. Ferraro Maggos v. Commissioner Bonner v. United States
True False
The proper manner in which case law should be utilized in the application of a discount for lack of control would be: a. b. c. d.
It is generally-accepted practice to only utilize federal cases It is generally-accepted practice to use the same discounts discussed in a particular case It is generally-accepted practice to use the case to understand the court’s reasoning for applying a certain discount It is generally-accepted practice to use cases that have been decided in the last year
18 – Chapter Five
© 2003–2014 Robert J. Grossman and National Association of Certified Valuators and Analysts 2014.v1
CURRENT JUDICIAL DEVELOPMENTS
ADVANCED DISCOUNTS AND PREMIUMS CHAPTER 5 REVIEW QUESTIONS
© 2003–2014 Robert J. Grossman and National Association of Certified Valuators and Analysts 2014.v1
Chapter Five – 17
CURRENT JUDICIAL DEVELOPMENTS
Advanced Discounts and Premiums
ADVANCED DISCOUNTS AND PREMIUMS CHAPTER REVIEW QUESTIONS Chapter 5: Current Judicial Developments Affecting Control Premiums and Minority Discounts 1.
Which court case potentially abused its discretion with its decision—disallowing the application of both a minority and a marketability discount? a. b. c. d.
2.
Which case rejected the methodology of using premium studies? a. b. c. d. e.
3.
Estate of True v. Commissioner HMO-W v. SSM Health Care System Maggos v. Commissioner Gow v. Commissioner Bonner v. United States
In Estate of True v. Commissioner, the IRS argued that the minority interests represented swing votes and, therefore, would not be subject to a minority interest discount—this position was upheld by the court. a. b.
4.
Estate of Joseph Cidulka Ferraro v. Ferraro Maggos v. Commissioner Bonner v. United States
True False
The proper manner in which case law should be utilized in the application of a discount for lack of control would be: a. b. c. d.
It is generally-accepted practice to only utilize federal cases It is generally-accepted practice to use the same discounts discussed in a particular case It is generally-accepted practice to use the case to understand the court’s reasoning for applying a certain discount It is generally-accepted practice to use cases that have been decided in the last year
18 – Chapter Five
© 2003–2014 Robert J. Grossman and National Association of Certified Valuators and Analysts 2014.v1
