MTS Journal

A special note from the Editor of ASA’s MTS Journal.

News from ASA’s Machinery and Technical Specialties Committee.

On July 25, 2010, the MTS Committee adopted revised definitions of value which all appraisers may now use.

The huge surplus of used Injection Molding Machinery and Equipment which hit the market in 2009 has largely cleared and resale values show significant signs of firming.

Orderly Liquidation is defined by the ASA as “an opinion of the gross amount, expressed in terms of money, that typically could be realized from a liquidation sale, given reasonable time to find a purchaser(s) with the seller selling on an as-is basis.

Beginning with the fixed asset records as the basis for the valuation has its limitations and appropriate due diligence must be performed in order to perform an accurate and credible valuation.

In 2010, ASA launched its first “Modeling Course.” Participants gained awareness training and the skills to discuss and manipulate fixed asset accounting, engineering data systems and/or field developed data for various valuation applications.

This article explains the calculation of economic useful life, using the example of a Dell server.

This article illustrates the modeling used today to develop expected liquidation values under various scenarios, and proposes additional models that should be used to reduce risk and improve the accuracy of advance rates.

Functional obsolescence (“FO”) is an often misunderstood form of depreciation. Depending on the age, technology, and efficiency of the subject property, the impact of FO can vary widely.