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account activity. He developed a survival curve reflecting the
rate of retirement and the age of the assets. The starting and
ending dates for all accounts in existence from 1975 to 1989 were
reviewed. On the basis of that analysis he determined that cash
and margin customer accounts had useful lives of 4 and 6 years,
respectively.
Mr. Knoblick used that same methodology to determine the
useful life of the pension customer accounts to be 14.66 years
(rounded to 15). For the same reasons as stated for cash and
margin accounts, we accept petitioner’s use of 15 years for the
pension customer accounts. We also note that we likewise accept
and hold that the fair market value of the pension accounts was
$2,110,000.
The value of Rose’s institutional customer accounts, which
represented a small portion of Rose’s customer accounts in actual
numbers and revenue, was allocated between the intangible assets
denominated “Chase Vendor Agreements” and “Chase Priority
Marketing Access Agreement”. The vendor and marketing agreements
were valued, as intangibles, at $592,000 and $690,000,
respectively, and were assigned tax bases of $575,000 and
$671,000, respectively. We also find for petitioner on those
valuations and useful lives.27
27 We note that our findings and holdings in these cases
result in a total fair market value for the acquired Rose
(continued...)
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