NACVA NACVA Certifications CVA Questions & Answers

• Question 151:

  _________________ are excellent sources of statistical, analysis and projections of regional, national and international economic and financial conditions.

  A. Bank reviews

  B. Bank letters

  C. Federal reserve bulletin

  D. Economic summaries

  Correct Answer: B

• Question 152:

  Which one of the following is perhaps the most valuable source of authoritative information on a particular industry?

  A. Financial data

  B. Industry surveys

  C. Business press

  D. Trade associations

  Correct Answer: D

• Question 153:

  To get an explanation or interpretation of something on the financial statements, or to consult working

  papers for details that augment the financial statements, it may be necessary to interview the company's

  outside independent accountant.

  This is most often the case when:

  A. The financial statements are not audited

  B. Not completely footnoted

  C. Contain some kind of unqualified opinion by the independent accountant

  D. Contain some kind of unqualified opinion by the attorney and banker

  Correct Answer: AB

• Question 154:

  An analysis of fixed and variable expenses will help the analyst understand:

  A. The extent to which increased or decreased volume will affect operating margins

  B. What can be done to make the company more profitable and what are the associated costs?

  C. The lack of compliance with revenues

  D. Overfunded and underfunded factors

  Correct Answer: A

• Question 155:

  Proprietary technology is also counted in intangibles such as, a trained and assembled workforce, special know-how, customer relationships, supplier relationships, or other intangible assets that make the company available competitors and give it earning power. Some closely held business owners call these intangibles:

  A. Blue sky

  B. Good will

  C. Patents

  D. A or B

  Correct Answer: D

• Question 156:

  When the valuation subject is a controlling ownership interest in the company, the existing total compensation less _________________compensation may be considered excess compensation.

  A. Abnormal compensation

  B. Overtime charges

  C. Non-controlling interest

  D. Normal compensation

  Correct Answer: D

• Question 157:

  In the direct capitalization economic income method, the value of the company is estimated by dividing the expected economic income of company by an appropriate:

  A. Direct capitalization rate

  B. Indirect capitalization rate

  C. Direct discount rate

  D. Indirect discount rate

  Correct Answer: A

• Question 158:

  The analyst should be curious about the proprietary products and services, especially:

  A. Benefits attributable to brand name, trademarks copyrights or patents

  B. Favorable supplier contracts

  C. The unique characteristics that generate a comparative advantage over their competition

  D. Intangible assets

  Correct Answer: C

• Question 159:

  The analyst should try to gain an understanding of how the company perceives the industry and the particular aspect within which it operates. Which one of the following is NOT out of such aspects?

  A. What are the nature and rate of technological changes affecting the industry?

  B. How does it try to do the best job of fitting in its niche?

  C. What special industry factors have a bearing on this particular company?

  D. What is the progress and prognosis for new products or services, locations, channels of distribution, etc.?

  Correct Answer: B

• Question 160:

  Which of the following agreements often restrict the marketability of the subject interests and they can, correspondingly, affect the value of other classes of equity as well?

  A. Buy-sell agreements

  B. Repurchase agreements

  C. Employment agreements

  D. Non-compete agreements

  Correct Answer: AB