Industry News & Updates

Stay current on the latest in the industry

Industry News & Updates

Stay current on the latest in the industry

The Changes to Rule 702 From a Damages Expert’s Perspective

Since its enactment in 1975, Rule 702 of the Federal Rules of Evidence has sought to redirect standards for the admission of expert testimony from a focus on “general acceptance in the profession” to one that places a greater emphasis on whether it is “scientifically valid and properly…applied to the facts at issue.” Amendments enacted in 2000 and 2011 have sought to clarify how judges are to assess the reliability of proffered testimony, either through the addition of factors to be considered (e.g., the Daubert standard, which also charged judges to serve as gatekeepers to exclude unreliable expert testimony) or by making the rule more easily understood and consistently applied.

Post-Implementation Review of Topic 606 Roundtable Observations

The FASB post implementation review (“PIR”) of ASC 606 is a process that evaluates the effectiveness of the revenue recognition standard that was issued in 2014 and became effective for most entities between 2018 and 2020. The PIR aims to assess whether the standard meets its objectives of providing useful information about the nature, amount, timing, and uncertainty of revenue from contracts with customers, and whether it improves comparability across entities and industries. The PIR also considers the costs and benefits of applying the standard, and whether there are any unintended consequences or areas of difficulty in implementation.

Government Contract Financial Due Diligence/Quality of Earnings Considerations

Focused due diligence and a carefully negotiated agreement can help mitigate risks for government contractors engaged in a merger or acquisition. The U.S. government contracting market has continued to see significant M&A activity from both private equity and strategic buyers. This is due to the perceived stability, steady growth, and free cash flows being generated within the industry. In times of global insecurity, be it economic or geopolitical, government contractors often benefit from increased federal spending.

Internal Audit and Government Contract Compliance: Working Together to Gain Efficiencies and Increase Effectiveness

Over the years in working with varying clients and meeting Government Contract Compliance (“Compliance”) and Internal Audit (“IA”) leadership, we continue to find that in many cases these functions/organizations rarely communicate and seem to be fairly siloed with minimal coordination in achieving their missions. This can happen for any number of reasons; including for example, the additional time required for Compliance to coordinate and support IA assessments, the potential view that IA’s role and experience focus on financial statement reporting controls and wouldn’t be particularly helpful to Compliance, or fear of increased scrutiny resulting in unnecessary and unwanted attention from executive management. Although it is understandable that certain Compliance leaders are hesitant to work with IA, there is good reason for Compliance to consider increasing their coordination with them.

Don’t Focus Too Much On Expert Billing Rates

As commercial damages consultants, one question we are always asked when meeting with a potential new client is “What are your hourly billing rates?” It is certainly a reasonable inquiry, and we dutifully provide the answer. In many instances, a “go/no go” decision may be reached right then and there, as the client may only view the choice of an expert as a litigation accessory or option. However, such thinking does not allow for an assessment of the benefit side of what is really a value proposition. In this article, we discuss avenues of inquiry that can be explored to identify factors or traits that, along with the cost of retention, can yield a more informed decision.

Using A Seasoned Generalist Damages Expert

Some damages experts describe themselves as specializing within specific industries, such as a construction damages expert. Others self-identify based on the type of damages analysis they typically perform such as intellectual property or labor. However, many experts are afraid to identify themselves as “generalists,” fearing they will be viewed as not having much expertise in any particular damages area. However, using a seasoned generalist damages expert can offer a number of benefits for the client and their outside counsel. Some of these benefits include the following: