Academic journal article Journal of Accountancy

Powerful Testimony Techniques

Academic journal article Journal of Accountancy

Powerful Testimony Techniques

Article excerpt

Knowing what to expect and how to respond are the keys to being an effective expert witness.

A CPA who performs business valuation and other litigation services often must appear as an expert witness in trials involving, for example, a disenfranchised shareholder, a dissolving partnership, divorcing spouses, a tax dispute or lost corporate profits.

The most exciting part of litigation services is the trial and, particularly, the cross-examination. But whether the CPA will be a shining or a falling star depends on his or her effectiveness on the witness stand.

This article provides information and illustrations of some effective and not-so-effective ways of presenting expert witness testimony in business valuation engagements. It also offers pointers on how the CPA can help the attorney approach a client's case and the opposition's expert witness.


The voir dire--the expert qualification process--offers the opportunity to make a good first impression on the fact finders--the judge or jury--by introducing the witness to them on a personal and not purely professional basis (see the sidebar on page 81 for an overview of the trial process). The most effective first statement is a response to the following:

Q:Would you please tell the court your name and your business specialty?

The answer immediately evokes a personal relationship rather than legal formality. Compare that question with

Q. State your name for the record. Are you a certified public accountant?

Follow-up questions should be open-ended and relate to the expert's background, education, training and experience. They should be framed so the witness can respond in a conversational manner rather than in a blunt yes-or-no fashion. Properly framed questions would be:

Q: Please tell the court about your educational background.

Q: Please tell the court of your certification as a business appraiser and explain the process of becoming a certified business appraiser.

How not to answer voir dire questions. It is critical that the witness appear confident but not cocky and not overstate his or her qualifications. It's wise, too, not to emphasize accomplishments that don't relate to the matter before the court.


Direct examination is the process of presenting evidence in support of a client's case. In a business valuation, it is the presentation of the expert's opinion of value. If the testimony is not accepted as reasonable, it could be disregarded entirely.

Effective direct examination testimony would begin like this:

Q: Did you have an opportunity to make an appraisal of the value of the XYZ Corporation?

A: Yes, I did.

Q: And what, in your opinion, is the value of the company?

A: The value of the company on June 30 of this year was approximately $5.4 million.

Q: Can you explain to the court how you made your appraisal?

The appraisal results can be stated at the beginning or at the conclusion of testimony. Presenting them at the beginning generally is more effective because

* It suggests strong belief in the value, which helps the witness's credibility.

* The stated value becomes the target the fact finders will consider throughout the trial. Without this target, they will try to develop their own estimates that may differ significantly from the witness's value.

* It helps the fact finders remember it throughout detailed testimony and understand the connection with the conclusion.

* Later testimony can be designed to support the value.

To lecture or not? Some attorneys ask highly experienced witnesses to explain how an opinion was found and then allow them to lecture about business valuation methods without interruption or prodding. When it's over, the fact finders should be totally convinced of the reasonableness of the conclusion. …

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