Fvs Podcasts

Thanks for listening. It takes just a couple of minutes to share your feedback. You can also contact us directly at podcast@aicpa-cima.com Is CAPM still the gold standard for determining cost of capital—or is it time for a rethink? Valuation expert Roger Grabowski explores why CAPM often fails in practice and how shifting toward investment-specific risk provides a more accurate framework for real-world decision-making. We also discuss multi-factor models, ASC 820 implications, and practical strategies for communicating risk concepts to courts and auditors.  Key Takeaways  CAPM's Limitations: Decades of research show CAPM struggles to predict returns accurately, making it less reliable for valuation in practice. Investment-Specific Risk: Moving beyond company-specific risk to focus on risks tied to cash flows offers a clearer, more relevant approach. Aligning Theory with Practice: Modified CAPM, multi-factor models, and ASC 820's exit value concept help valuation professionals better reflect market realities