Janik Forensics PC, CPA, Business Services & Forensic Accounting, Financial, Construction Claims, Damages, Lost Profits
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Examples of Lost Profits Methodologies

Methodology/Approach

Before-and-After1

A. "Would Have Been"

Based on actual results before and/or after alleged event(s)

B. Actual

C. Damage (C = A - B)

Yardstick1

A. Unaffected similar company, industry or market

B. Actual

C. Damage (C = A - B)

Sales Projections
(Hypothetical Profits)1

A. "Would Have Been"

Based on business plans and projections

B. Actual

C. Damage (C = A - B)

The CPA can suggest several different ways to prove facts or make points, such as using the following three common methods to compute lost profits:

1 Source: AICPA (American Institute of Certified Public Accountants) Consulting Services Practice Aid 93-4; Providing Litigation Services; Peter B. Frank, CPA and Michael J. Wagner, CPA, JD; 1993

Applied Methodology and Principles

To gather and obtain facts, information, documents and other sufficient relevant evidence seen in our reports and addendums, our fact finding work includes: