Charles C. Dockery, Donor - Page 19

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          Crossroads' common stock was zero on January 1, 1992, and                   
          $3,312,000 ($331 per share) on January 1, 1993.                             
               4.   Respondent's Appraiser:  Raymond Wise                             
               Wise calculated the value of Crossroads' stock using two               
          methods:  the book value method and the price/earnings method.              
          He used Crossroads' assets and liabilities from its December 31,            
          1991, balance sheet as a starting point to estimate the book                
          value.  He did not review any of the reinsurance policies or the            
          underlying claims experience for the self-insurer funds.                    
               Wise concluded that Crossroads' reserves for unpaid claims             
          should be reduced by 30 percent based on his review of                      
          Crossroads' balance sheet and what he said was an industry                  
          standard requiring a 50-percent ratio between claims paid and               
          reserves.  Thus, he multiplied Crossroads' unpaid claims by 70              
          percent and recorded the product on his adjusted balance sheet.             
          He added the adjusted unpaid claims to Crossroads' other                    
          liabilities to get its total liabilities "corrected".  He                   
          subtracted total liabilities corrected from Crossroads' total               
          assets, and projected that the book value of Crossroads' stock              
          was $1,241 per share as of January 1, 1992, and $1,580 per share            
          as of January 1, 1993.  Wise estimated the price/earnings value             
          of Crossroads' stock using Rev. Rul. 59-60, 1959-1 C.B. 237                 
          (which suggests using corporate financial statements for the 5-             








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