Estate of James J. Renier, Deceased, Kent L. Renier and Dubuque Bank & Trust Company, Co-Executors - Page 36




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          2.  In Mr. Kramer’s judgment, the appropriate multiple for                  
          valuing Renier was 1.5.                                                     
               We do not find Mr. Kramer’s application of the business                
          broker method helpful in valuing Renier.  Mr. Kramer provided no            
          justification for the multiple he chose to apply to Renier’s                
          discretionary cash other than his own judgment.  In the absence             
          of any underlying data supporting Mr. Kramer’s selection of a               
          multiple, we are unable to assess its appropriateness.  See Rule            
          143(f)(1).  Thus, on this record the reliability of the business            
          broker method has not been established.                                     
               D. Conclusion                                                          
               Both experts used an asset approach to value Renier’s                  
          nonoperating assets and concede that such an approach would be              
          inappropriate to value Renier’s operating assets.  We agree with            
          their conclusions in this regard.  As Mr. Sliwoski also                     
          disregarded his market approach and as we have rejected Mr.                 
          Kramer’s business broker method, we conclude that the income                
          approach provides the best method for valuing Renier’s operating            
          assets.  Therefore, with nonoperating assets of $470,925, using             
          an asset approach, and operating assets of $606,019, using an               
          income approach, we find Renier had a fair market value on the              
          valuation date of $1,076,944, or $43.08 per share.  Consequently,           
          we further conclude that decedent’s 22,100 shares in Renier on              
          that valuation date had a value of $952,000.                                
          II.  Addition to Tax                                                        




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