NACVA Exam Questions Instant Access - No Installation Required

Question 1

A control owner or potential owner might make control adjustments, but a minority owner, generally, could not force the same changes. Therefore, control adjustments normally would be made only in the case a controlling interest valuation, unless there was reason to believe that the changes were imminent and probable. These include all of the following EXCEPT:

AExcess or deficient compensation and perquisites

BGains, losses or cash realization from sale of excess assets

CDiscounted operations

DElimination of operations involving company insiders (e.g. employment, non-marketrate leases)

Answer : C

Question 2

Situations commonly requiring the valuation of option are all of the following EXCEPT:

AWhen the option is designed, granted exchanged, or terminated

BWhen financial statement disclosure requires that the option value is recognized

CWhen the option value is at issue in a damage suit, such as a breach of contract suit between an existing or former executive and the issuing company

DWhen the option is a repurchased option by the OTC market

Answer : D

Question 3

The United State is by far the world leader in markets for both publicly traded securities and closely held businesses and business interests. Two factors have combined to accelerate the spread of U.S technology in financial appraisals and market throughout the world. Which of the following is/are of those factors?

ARapidly increasing international flow of capital

BGrowing privatization of formerly socially owned businesses in almost every country of the world.

CIncreased inflation in major parts of the world

DSecondary market securities trading phenomenon

Answer : A, B

Question 4

There is no set of number guideline companies to use. However, the more data there are about each company and the greater the similarity between the subject company and the companies chosen as guideline companies, the ______ guideline companies will pass muster.

AGreater

Bfewer

CAverage

DDepends on selection procedures and industry type

Answer : A

Question 5

''Market value is the most probable price which a property should bring in a completive and open market under all conditions requisite to fair sale the buyer and seller each acting prudently and knowledgeably, and assuming the price is not affected by undue stimulus.'' Implicit in this definition is the consummation of a sale as of a specified date and the passing of title from seller to buyer under conditions/s whereby:

ABuyer and seller are typically motivated

BBoth parties are well informed or well advised and acting in what they consider their best interests

CA reasonable time is allowed for exposure in the open market

DDifferences in financing costs and tax status

Answer : A, B, C

Question 6

A common first step in ratio analysis of financial statements is to prepare what are sometimes called ____________________. On these statements, each line item is expressed as a percentage of the total. For example, on the balance sheet, each line is shown as a percentage of total assets.

APre-analysis statements

BCommon-size statements

CShort-term analysis

DStatus diagnosis analysis

Answer : B

Question 7

''Fair value'' means the value of the corporation's shares determined:

AImmediately after the effectuation of the corporate actions to which the shareholder objects

BUsing customary and current valuation concepts and techniques generally employed for similar businesses in the context of the transaction requiring appraisal

CWithout discounting for lack of marketability or minority status except, if appropriate, for amendments to the articles...

DThat the majority states use the pre-1999 definition

Answer : B, C

NACVA Certified Valuation Analysts CVA Exam Questions