In virtually all the expert witness reports we have been associated with over the last 15 years at least one quantum calculation has been required.
In a few cases this has been a very straight forward assessment of money in at the start and money out at the end of the review period. However, most are far more complicated than this and include multiple cash flows with variable investment risk profiles and time horizons.
Over time we have developed detailed and sophisticated spreadsheets which can accurately consider investment returns for periods of up to 20 years. These spreadsheets have been developed such that we can now allow for the following criteria: -
- Multiple cash flows in. This can be multiple single lump sums, regular deposits or a combination of both;
- Multiple cash flows out. This can be multiple single lump sums, regular income or withdrawals or a combination of both;
- Multiple end dates. It is not unusual for our quantum calculations to have more than one end date. This is most common where we are asked to make returns to a date when an investment manager was cancelled, or the portfolio transferred to a new manager, with the quantum losses carried forward to a later date;
- Management charges. We can adjust for management charges applicable to a portfolio or fund. The charge rate can be fixed or variable;
- Currency adjusted returns. We can adjust for the investment returns in any major currency;
- Taxation. We are able to adjust for applicable taxes which are due to income or capital gains, and also build in annual ‘tax free’ allowances where applicable. This can be further adjusted for personal, trust or pension portfolios.
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