In this episode of the Forensic Perspectives podcast, host Mark S. Gottlieb gives us an overview of how valuation discounts are used in business valuation, and a detailed look at two primary types: DLOC and DLOM. Episode Highlights: What are the two primary types of valuation discounts? (0:20) What four components is DLOC dependent upon? (0:30) Mark discusses investor’s control expectations and control prerogatives. (0:55) How do we quantify DLOC? (1:10) What is a discount for lack of marketability? (1:25) Mark breaks down how a sample valuation would be computed. (2:55) Key Quotes: “Control generally has certain prerogatives with it. Some of these are the rights to appoint management, to pay dividends, to direct business strategy, to set compensation and to divest assets.” - Mark Gottlieb “Marketability is defined as the ability to convert the investment or the business into cash. And generally, that conversion happens in three days or less.” - Mark Gottlieb “Often when we're evaluating a controlling interest, we either will not take a discount for marketability, or take a rather modest discount when compared to what would have been used if a minority interest would have been calculated.” - Mark Gottlieb Resources Mentioned: Mark S. Gottlieb, CPA, PC (MSG) Reach out to Mark S. Gottlieb