Estate of Arthur G. Scanlan, Deceased, Ruth B. Scanlan, Administratrix - Page 5

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          non-marketable, minority blocks of shares."5  Decedent’s Form 709                  
          shows that the value of $34.84 per voting share as of April 12,                    
          1991 (the date of the gift), was ascertained by:  (1) Starting                     
          with a value of $30,500 per voting share as of August 31, 1989,                    
          as stated in the 1989 report, (2) adjusting that value for a                       
          1000-for-1 stock split in June 1990, yielding a value of $30.50                    
          per share, and (3) increasing the latter figure by $4.34, to                       
          reflect an increase in book value per voting share from                            
          December 31, 1989, until December 31, 1990.                                        
                On February 1, 1992, a Form 706, United States Estate (and                   
          Generation-Skipping Transfer) Tax Return, was filed on                             
          petitioner’s behalf.  Petitioner’s Form 706 reported the                           
          date-of-death value of Decedent's Eatel stock at $35.20 per                        
          share.  This amount was based on a two-page valuation report of                    
          C & A, signed by Mr. Chaffe on October 21, 1991 (1991 report).                     
          C & A prepared the 1991 report by relying heavily on its 1989                      
          report.  The 1991 report also states that C & A:  (1) Reviewed                     
          Eatel’s certified financial statements for its calendar years                      
          ended December 31, 1989 and 1990, as well as Eatel’s uncertified                   
          financial statements for the 7-month period ended July 31, 1991,6                  
          (2) discussed with Eatel’s president Eatel’s past, present, and                    
          future business decisions, as well as the state of the                             

                5 The 1989 report states that DATA has 21 shareholders.                      
                6 C & A also looked at the relevant financial statements of                  
          Eatel’s subsidiaries.                                                              




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