Shareholder disputes are often initiated by a shareholder who believes they are being disadvantaged by other shareholders, management or the board of directors. Some of the factors that contribute to this are:
- Different levels of financial knowledge and background
- Different levels of involvement in the financial management and responsibilities of the company
- Frustration about different levels of compensation or questions about the validity of compensation paid
- Questions about the level or form of distributions from the entity
- Different expectations regarding the price and potential dilution from a transaction or fund raising
- Differences of opinion about exit strategies
The key in a shareholder dispute is not the claim but the successful use of facts to resolve issues in the case. VFP has worked for both plaintiffs and defendants and is also sometimes hired to serve as neutral in mediation or settlement negotiations. The key to shareholder disputes is to get them settled if at all possible in order to avoid the distractions, destruction of company value, and frustration of all parties involved in these disputes.
Some of the financial forensic services VFP has provided include:
- Review and analyze financial data to assess its completeness, accuracy and reasonableness
- Review of business expenses to establish reasonableness and business purpose and to provide “normalized” expenses for use in business valuation or damages calculations
- Analyze historical compensation and benefits and benchmark against market compensation studies
- Reconstruct financial records for a business
- Trace economic interests and assets across business entities / business agreements
- Assist counsel to prepare document requests, information collection and interviewing key parties
- Review reports submitted by other financial experts
- Issue an expert report of our findings and if necessary testify in a deposition or in court
The VFP team is experienced in performing these financial forensics analyses for disputes. To learn more about our forensic services, review: What are Financial Forensics?; Contract Disputes; Divorce; Trust & Estate Litigation and How is VFP Different? in the Forensic Services section.
