The American Institute of Certified Public Accountants (AICPA) has issued a Practice Aid discussing significant issues that should be addressed in order to attain reasonable certainty when opining on economic damages.
This paper highlights information in the AICPA Practice Aid, 2015, Forensic & Valuation Practice Aid, Attaining Reasonable Certainty in Economic Damages.
There is a borderline between permissible speculations to that of intolerable guesswork. A damages calculation need not prove that all elements are certain. The question is: do “uncertain” profits differ from “certain” profits?
Note that uncertain profits or speculative value is a characterization of the evidence and not a classification of profits or value. It is becoming ever more important that the damages expert focuses on:
A damages expert must demonstrate that, subsequent to the wrongful act, the plaintiff experienced some economic harm, such as a reduction in its sales, profits or value. But just as important, the damages expert should consider the impact of qualitative factors, such as: