Proper Valuation Research Articles

A possible reconciliation between exergy analysis, thermo-economics and the resource cost of externalities

Goal of this paper is to highlight and place in a comprehensive historical perspective the consequential continuity between the first attempts to link the concept of monetary cost to thermodynamic principles and the latest developments that led to exergy-based cost indicators and Sustainability numeraires.This is an orientation paper, and a conscious effort was made to avoid presenting the advancements in the economic-thermodynamic paradigms by simply listing them in their chronological order: whenever possible, and on the basis of well-documented references, a “conceptual tree” is discussed that originates with the introduction of the exergy concept (the roots), grows through a trunk (cost formation theory, Techno-Economics) and main branches (Thermo-Economics, Cumulative Exergy Consumption …) and terminates with the latest exergy-based cost theories.In Section 2 a brief recap of the concept of “cost” is provided, to clarify the different physical bases and proxies adopted in different approaches. Sections 3 and 4 contain a brief historical outline of the path that led from the recognition that exergy is a proper valuation index for energy to the initial critique to Techno-Economics and to the formulation of Monetary Thermo-Economics and to some of its initial developments. Techno-Economics, Thermo-Economics (both monetary and purely exergy-based), and other paradigms that postulated a quantifiable correlation between exergy and production cost are discussed in sections 6 through 10. Every effort has been made to provide the most relevant references for each conceptual and practical statement reported in the paper: as a result, the Reference list has grown beyond the Journal page limit, and it is available as a separate file in the Additional Material.

Examining valuation of corporate naming rights partnerships in collegiate sports and their impact on consumer behavior

PurposeMost college athletics department have not sold corporate naming rights to their athletics facilities. Popp et al. (2016) suggests two primary reasons: (1) difficulty in determining proper valuation and (2) fear of stakeholder backlash. The purpose of the current study is to address both concerns by utilizing a hedonic pricing model predicting collegiate naming rights values and utilizing fixed-effects models to determine if consumer behavior (event attendance and donations) is impacted by a corporate name change.Design/methodology/approachData from 110 naming rights agreements among NCAA Division I programs were examined, alongside market-related variables, institution-related variables and venue-related variables. Utilizing hierarchical model building to reduce independent variables and OLS regression modeling, significant relationships with annual value of naming rights agreements were uncovered. Fixed effects models were utilized to determine if naming rights impacted attendance and donations.FindingsA final model explained more than 53% of the variance in average annual value of naming rights agreements, with three significant factors: (1) attendance, (2) all-time winning percentage and (3) venue construction cost. Fixed-effects models revealed no significant differences in attendance or donations after a naming rights deal was signed.Originality/valueCorporate naming rights agreements for college athletics facilities are a recent phenomenon. While a similar study examining drivers of collegiate sport naming rights was previously conducted, the current study revealed a shifting marketplace. In addition, no prior study has examined the impact of a corporate naming rights agreement on future attendance and donations.

A Novel Model for House Price Prediction with Machine Learning Techniques

In this paper, we are going to use machine learning algorithms for house price prediction. House prices increases drastically every year, so we felt a need for a system that will predict house prices in the future. Due to a lack of knowledge of property assets people cannot guess the accurate price of houses. Therefore, we felt a need for a model that will predict an accurate house price. So, the main aim of our project is to predict the accurate price of the house without any loss. This survey also deals with a comparative analysis of the results of the algorithms used and the model with the highest accuracy and minimum error rate will be implemented. For the choice of prediction ways, we tend to compare and explore numerous prediction ways. We tend to utilize Linear and random forest regression as our model attributable to its liable and probabilistic methodology on model Choice. Our result exhibits that approach to the problem ought to achieve success and has the flexibility to predictions that will be compared to different house price prediction models. We have a proclivity to propose a house price prediction model to hold up a customer to estimate the proper valuation of a house.

Age of top european football players when they started organized training and their value in the transfer market

There are a few schools of thought about when kids should start playing sports. This study set out to find out when the football players performing at EURO 2020 began trainings in an organized way – on average they were just over 8 years old. The second research issue addressed in this article is the financial value of the players. Football experts, with the support of scientists, do their best to determine the appropriate value of players, and it's still not easy. The proper valuation of players is an important issue because it influences the management process of football clubs. The study also set out to see if there is a relation between the age of starting to practice in organized way and the subsequent value of the athlete? A univariate regression analysis was performed, in which the dependent variable was player value, and the independent variable was the age of the athlete when he started to play football in organized way. Based on the regression coefficients, it can be concluded that players who started at younger ages now show a higher level of value. In conclusion, the results show how demanding professional sport is and at what age a person needs to make the right decisions to be able to think about being a professional footballer.

Valuation of cryptoassets in EU insolvency: Challenges and prospects

AbstractHow and when to determine the value of cryptoassets in insolvency proceedings? This question becomes more topical with the increasing adoption of volatile cryptoassets such as Bitcoin. As many of these assets do not have an ‘apparent’ value that may be readily ascertainable, it is not always clear how their value may be established. This presents significant challenges to their proper valuation in the context of insolvency proceedings and requires certain attention to efficiently confront the implications on the assessment of claims, the calculation of their value and the determination of the recoverable amount. Accordingly, this Article exposes the arising challenges and implications from an EU insolvency perspective, with the aim to trigger considerations for legislative interventions at EU level.

Fraud in startups: what stakeholders need to know

PurposeThis paper aims to explain the fundraising and valuation processes of startups and discuss the conflicts of interest between entrepreneurs, venture capital (VC) firms and stakeholders in the context of startup corporate governance. Further, this paper uses the examples of WeWork and Zenefits to explain how a failure of stakeholders to demand an external audit from an independent accounting firm in early stages of funding led to an opportunity for fraud.Design/methodology/approachThe methodology used is a literature review and analysis of startup valuation combined with the Fraud Triangle Theory. This paper also provides a discussion of WeWork and Zenefits, both highly visible examples of startup fraud, and explores an increased role for independent external auditors in fraud risk mitigation on behalf of stakeholders prior to an initial public offering (IPO).FindingsThis paper documents a number of fraud risks posed by the “fake it till you make it” ethos and investor behavior and pricing in the world of entrepreneurial finance and VC, which could be mitigated by a greater awareness of startup stakeholders of the value of an external audit performed by an independent accounting firm prior to an IPO.Research limitations/implicationsAn implication of this paper is that regulators should consider greater oversight of the startup financing process and potentially take steps to facilitate greater independence of participants in the IPO process.Practical implicationsGiven the potential conflicts of interest between VC firms, investment banks and startup founders, the investors at the time of an IPO may be exposed to the risk that the shares of the IPO firms are overvalued at offering.Social implicationsThis study demonstrates how startup practices can be extended to the Fraud Triangle and issue a call to action for the accounting profession to take a greater role in protecting the public from startup fraud. This study then offers recommendations for regulators and standards entities.Originality/valueThere are few academic papers in the financial crime literature that link the valuation and culture of startup firms with fraud risk. This study provides a concise explanation of the process of valuation for startups and highlights the considerations for stakeholders in assessing fraud risk. In addition, this study documents an emerging role for auditors as stewards of proper valuation for pre-IPO firms.

A REVIEW OF HERBAL MEDICINE USED IN WOUND HEALING

The main purpose of this review is to identify herbal medicines with great potential for treating minor wounds. The herbal medicine in wound healing for both traditional and nontraditional forms of the medicine dating back at least 5000 years. The herbs are minimal unwanted side effect. Based on medicine to prove efficacy of herbal medicines & focus on better understanding for their mechanism of actions, the more Scientist were increase on modern Scientific method and evidence. Quantitative human health benefit for herbal medicine is still rare or dispersed for limiting their proper valuation. The traditional medicinal plants are prepared by wound healing purposes covering a broad area of different skin related diseases. The herbal medicine in wound management involve disinfection, debridement & provision of a suitable environment for aiding the natural course of healing. Here we are report on some plants, which are used as wound healing agent in traditional medicine around the world

Experimental and computational modeling of the biological activity of benzaldehyde sulphur trioxide as a potential drug for the treatment of Alzheimer disease

Alzheimer's disease is a major public brain infection that has resulted in many deaths as revealed by the world health organization (WHO). Conventional Alzheimer treatments such as chemotherapy, surgery, and radiotherapy are not very effective and are usually associated with several adverse effects. Therefore, it is necessary to find new therapeutic approach that completely treat Alzheimer disease without much side effects. In this research work, we report the experimental and in silico molecular modeling of the biological activity of a novel azo-based compound as potential candidate for Alzheimer's disease. The synthesized compound was obtained by coupling reactions with 4-amino-3-nitrobenzaldehyde. Suitable purification and characterization techniques were employed and density functional theory (DFT) computational approach as well as in-silico molecular modeling has been employed to assess the electronic properties and anti-Alzheimer's potency. Suitable protein targets often regarded as target sites for most therapeutic vaccines for the said disease (4EY7, 1QTN, 4EY7, and 6EUE) have been selected for molecular docking investigation. For proper valuation of the drug candidacy, molecular docking studies were compared with conventional Alzheimer drug (donepezil). Also, the spectroscopic properties of the studied compound were investigated and compared with experimental data. Our findings show that the studied structure is relatively stable and expresses greater binding affinities of −6.10, −9.01, −5.90, and −11.20 kcal/mol than donepezil which had binding affinities of: 5.30, −6.30, 5.90, and −10.70 kcal/mol for each protein target. Thus, demonstrating the efficacy of the studied compound as potential candidate for Alzheimer's disease.

Tax Rate Chargeable on Landed Properties in Tafa Local Government Area of Niger State, Nigeria

This study evaluates tax rate chargeable on landed properties in Tafa Local Government Area of Niger State, Nigeria, with a view to providing relevant information on the potentials of the tax as a source of local revenue generation which can be used for the provision of services and amenities. Data for this study was sourced from the records of landed properties assessed for taxation, tax rate chargeable and record of property tax collections available in the local government official records. Tables were used in analyzing and presenting the result for the study. The result of the study shows that tax rate chargeable on landed properties range from as low as N2, 000 to N120, 000. The result also indicates that there were different types of landed property tax collected in Tafa Local Government Area, such as title registration fee, tenement rate, survey fee, approval of building plan, ground rent, and change of land use. The study also shows that there are different types of landed properties on which tax is collected in Tafa Local Government Area. They include residential, commercial, industrial, agricultural, recreational and educational properties. There has been increased tax collection on landed properties in the study area from 2013–2016 due to more compliance and development of landed properties within the period. It is recommended that the local government administration should embark on a land ownership registration programme and automation of databases on landed property, establishment of an awareness forum by the local government where taxpayers would be sensitized and enlightened on the importance of land tax, and ensure proper valuation of landed properties for taxation.

A machine learning-based price state prediction model for agricultural commodities using external factors

In recent times of noticeable climate change the consideration of external factors, such as weather and economic key figures, becomes even more crucial for a proper valuation of derivatives written on agricultural commodities. The occurrence of remarkable price changes as a result of severe changes in these factors motivates the introduction of different price states, each describing different dynamics of the price process. In order to include external factors we propose a two-step hybrid model based on machine learning methods for clustering and classification. First, we assign price states to historical prices using K-means clustering. These price states are also assigned to the corresponding data of external factors. Second, predictions of future price states are then obtained from short-term predictions of the external factors by means of either K-nearest neighbors or random forest classification. We apply our model to real corn futures data and generate price scenarios via a Monte Carlo simulation, which we compare to Sørensen (J Futures Mark 22(5):393–426, 2002). Thereby we obtain a better approximation of the real futures prices by the simulated futures prices regarding the error measures MAE, RMSE and MAPE. From a practical point of view, these simulations can be used to support the assessment of price risks in risk management systems or as decision support regarding trading strategies under different price states.

Contribution of Forestry in Economy and Employment Generation in Nepal

The forestry sector provides a vast array of goods and services to mankind. Goods and services like timber, medicine, fodder, tourism carbon sequestration, and soil and water conservation were used by people from early ages. But its contribution hasn’t been accounted for properly. The study is aimed at collecting data on the contribution of the forestry sector to the national economy and employment generation in Nepal. Data on the economy and employment contribution were collected from reviewing the literature, Nepal government's annual reports. At present agriculture and forestry sector contributes about 27% to the national GDP. Among different forest products timber is regarded as major production to earn royalty inside the country that Nepal government earned a royalty of NRs 279.9 million from annual production of 10.2 million cubic feet timber in the fiscal year 2019/2020. But non-timber forest product is regarded as the main forest product which is exported from the country that Nepal exported medicinal plants of US$6.48 million in 2016. Over 150,000 people are employed in timber-based manufacturing industries. The government institutions have provided around 143,000 employment in the forestry-related sector. Having high potentiality of contributing to job formation and income generation still forestry sector has not been regarded as a major sector of national income. Its contribution has not been accurately calculated which has underestimated the economic value of the forest. Hence, there is a need for the formation of proper valuation techniques and practice of keeping good market records of the utilization of natural resources and employment generation.

The application of different term-structure models to estimate South African real spot rate curve

The purpose of this study is to investigate the suitable arbitrage-free term-structure model that might be able to fit the South African inflation-indexed spot-rate curve. The instrument has relatively less tradability in the market, which then translates into a lack of adequate data for bond valuation/pricing. Pricing deviations might give inflated/deflated projections on the value of government debt; consequently, higher estimated interest cost to be paid. A proper valuation of these instruments is mandatory as they form part of government funding/borrowing and the country’s budgeting processes in the medium term. The performance of newly developed non-linear multifactor models that follows the Nelson-Siegel (1987) framework was compared to the arbitrage-free Vasicek (1977) model and linear parametric models to assess any significant deviations in forecasting the real spot-rate curve over a short period. Models with constant parameters (i.e. linear parametric, cubic splines, Nelson-Siegel (1987) and Svensson (1994)) gave a perfect fit, they proved to marginally lose fitting capabilities during periods of higher volatility. Therefore, it could be concluded that the application of either Nelson-Siegel (1987) model or Svensson (1994) model on forecasting South African real spot-rate curve gave a perfect fit. However, for a solid conclusion to be derived, it is imperative to explore the performance of these models over a period of stressed market and economic conditions.

Carbon versus Timber Economy in Mediterranean Forests

Forests produce goods and services, but the forest economy is based on goods, with market price, more than on services. Under Mediterranean climate conditions forests have low timber production, being frequently financially loss-making, despite the environmental services provided, such as carbon sequestration. Timber production and carbon sequestration are compatible, and a proper valuation of both can allow for a more balanced management. The aim of this paper is to assess financially a scenario based on maximizing carbon sequestration versus another based on maximizing timber harvesting in a Mediterranean forest. To do that, timber stock, growth and harvesting, and carbon sequestration have been calculated. Applying market prices for timber and CO2 both scenarios have been assessed, carrying out a sensitivity analysis. Maximising carbon sequestration was more profitable in the vast majority of combinations; timber harvesting was only more profitable if CO2 prices fell below 30% and timber price increases more than 20%; timber price rise is possible, but a collapse in CO2 price is not probable. The real barrier is that while timber is as a commodity with market price, carbon sequestration is not. The challenge for the future is to pay for carbon sequestration, mobilising resources from polluting sectors to forests.

Increasing provision of ecosystem services through participation in a conservation program

Grasslands provide a variety of goods and services that benefit humans, but only a few have a market value. Despite the benefits provided, native grasslands continue to be degraded. Lack of a proper valuation, including a monetary value of grassland nonmarket goods and services, has become one of the factors contributing to the degradation trend. The objective of this research was to quantify the cost of increasing the provision of ecosystem services from grassland ecosystems in the Gulf Coastal Plains and Ozarks (GCPO) Landscape Conservation Cooperative geographic area of the U.S. A contingent valuation method (CVM) was used to estimate landowner willingness to accept (WTA) monetary compensation in exchange for implementing management practices preserving grassland ecosystems. The mean WTA compensation was $290.10 per acre per year for a 10-year contract. Required compensation increased with landowner income, frequency of contacts with state wildlife agencies, and percentage change in grassland area. Landowner age and proximity to the nearest local park were negatively associated with WTA. The total cost of preserving ecosystem services, estimated based on WTA, was US$3 billion per year and 57 times larger than the 2016 Conservation Reserve Program (CRP) allocation for this purpose in the amount US$50 million. However, the preservation cost varied from US$1.7 million to 1.1 billion depending upon the number of ecological attributes to be preserved and corresponding levels of ecosystem services. Results will be helpful in quantifying future funding levels necessary for implementation of coordinated conservation activities in grasslands and other ecosystems, prioritizing ecosystem services for restoration, and developing conservation programs in the U.S. and other countries.

A Short Critique on the Stance of the Netherlands Food and Consumer Product Safety Authority on Melamine Polymer Formaldehyde Exposures.

In February 2021, the Netherlands Food and Consumer Product Safety Authority came out with their risk assessment on formaldehyde exposure from melamine crockery with bamboo fiber to especially young children. In this short commentary, I will critique their assessment of this type of food-contact material (FCM). The main flaws are at least: (i) absence of a proper valuation of the available principal scientific literature yielding a biased risk assessment; (ii) discounting the endogenous formaldehyde formation that outweighs background exposure substantially; (iii) ad hoc positing of an unjustifiable and unfounded low background exposure levels to formaldehyde whereby risks of exposure to melamine formaldehyde is grossly exaggerated. This biased assessment has created societal unrest that is wholly uncalled for. Additionally, it has wide-ranging European consequences for the use of all melamine FCM.

A Comparison of Forecasting Mortality Models Using Resampling Methods

The accuracy of the predictions of age-specific probabilities of death is an essential objective for the insurance industry since it dramatically affects the proper valuation of their products. Currently, it is crucial to be able to accurately calculate the age-specific probabilities of death over time since insurance companies’ profits and the social security of citizens depend on human survival; therefore, forecasting dynamic life tables could have significant economic and social implications. Quantitative tools such as resampling methods are required to assess the current and future states of mortality behavior. The insurance companies that manage these life tables are attempting to establish models for evaluating the risk of insurance products to develop a proactive approach instead of using traditional reactive schemes. The main objective of this paper is to compare three mortality models to predict dynamic life tables. By using the real data of European countries from the Human Mortality Database, this study has identified the best model in terms of the prediction ability for each sex and each European country. A comparison that uses cobweb graphs leads us to the conclusion that the best model is, in general, the Lee–Carter model. Additionally, we propose a procedure that can be applied to a life table database that allows us to choose the most appropriate model for any geographical area.

Just-in-Time system in terms of real options

The value creation process in a company and the competitive position are critically influenced by corporate resource allocation and proper valuation of investment alternatives. After the Second World War, capital budgeting and strategic planning emerged as two complementary but different systems for resource allocation. The real options approach developed in the ’80s may provide a useful tool for making a connection between capital budgeting and strategic management. Real options are implicit managerial and operating flexibilities embedded in many non-financial assets and liabilities. In a wider sense: “A real option is the investment in physical assets, human competence, and organisational capabilities that provide the opportunity to respond to future contingent events” (Kogut-Kulatilaka, 2001). This paper shows that Just-in-Time (JIT) system as management philosophy can be regarded as a knowledge-based or capability-based implicit strategy rather than a simple, easy-toimitate best practice approach. Moreover, implementation of JIT can be considered as a strategic investment. The presentation focuses on how the relation among strategic investments, developed technological systems and corporate strategy can be expressed through the real options view.

Retail Apocalypse? Maybe blame accounting. Investigating inventory valuation as a determinant of retail firm failure

PurposeThe purpose of the study is to evaluate whether the selection of accounting method used to value inventory increases or decreases the probability of a retail firm's ability to remain in existence.Design/methodology/approachThis study employs a binary logistic regression model to predict group membership and the probability of failure. The study utilizes an unbalanced sample of US publicly traded failed and functioning retail firms over a ten-year period.FindingsThe results clearly support the conclusion that there is a difference in the probability of retail firm failure with respect to the accounting method used to value inventory. Merchants using a cost-based valuation method were 2.3 times more likely to fail than firms using a price-based method. The results also affirm existing bankruptcy literature by finding that profitability, liquidity, leverage, capital investment and cash flow are factors in retail failures.Practical implicationsThe results suggest that traditional merchants cannot simply blame e-commerce or shifts in demographics for the retail Apocalypse; good management and proper valuation of stock still matter.Originality/valueThis study is the first to look at firm failure in the retail sector after the great recession of 2008, in an era known as the “retail Apocalypse.” In addition, this study differs from other firm failure literature by incorporating cost- and price-based inventory valuation methods as a variable in firm failure.

Practical Application of Selected Methods of Intellectual Capital Valuation: A Research Study

Purpose: Reports on non-financial data include elements identified in the structure of intellectual capital, whose proper valuation is a challenge for business. The purpose of this study is to show the legal framework of the analysis, reporting and valuation of intangible assets and practical applications of selected methods of intellectual capital valuation on the example of the brewing industry. Design/Methodology/Approach: The methods selected for the purposes of this case study are the market value to book value ratio, the calculated intangible value index, the Tobin’s q ratio and the value-added intellectual coefficient. Calculations were made based on data from reports of a selected joint-stock company from the brewing industry. Findings: The carried out intellectual capital valuation has confirmed that applying only one valuation method does not give a fair view of intangible assets, and the lack of considering context in the valuation makes the obtained data lose its decision-making value. Practical Implications: A new approach to the process of intellectual capital valuation, based on long-term integration of selected valuation methods as well as on consideration the context of the analyzed numbers, has been proposed. Originality/Value: The results are original because they can be used to develop future intellectual capital valuation scenarios. They constitute a kind of guide for intellectual capital managers.

Quantifying the uptake of climate services at micro and macro level

Quantification and communication of the expected net benefits of climate services for particular types of users and society at large has been hitherto a rather weak element in the deployment of climate services. This article discusses the challenges of quantification and warns that there is no universal method for this. It provides a general structure to assess benefit-cost ratios of new climate services. From this framework proper valuation of climate services can be developed. It also underscores the significance of aptness for verification of the performance of a climate service, as well as contextual effects, such as market form, regulations, and pace of innovation. Only for subsets of seasonal climate services the so-called cost-loss approach and some other forecast accuracy-oriented approaches are applicable. For other types of climate services performance indicators need to be developed. Furthermore, for some types of effectiveness evaluations more user/use oriented indicators are necessary, even if forecast accuracy based approaches would be applicable as well, as these approaches do not guarantee that the highest utility for the user has been achieved using the climate services. The proposed framework emphasizes the inclusion of competitive conditions under which the CS users operate, the role of information exclusiveness vs. sharing, the role of adequate quality assurance and communication, the effects learning and R&D for climate services.