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Scott A. Harshman is a partner in the Orange County office of Jeffer Mangels Butler & Mitchell LLP. Scott has an LL.M. in taxation from the University of San Diego School of law and is a certified specialist in estate planning, trust and probate law by the State Bar of California. He has extensive experience in tax, trust and estate matters and business planning, for high net-worth individuals, including wealth transfer planning, income tax planning, corporate and partnership taxation, business succession planning, and international estate and tax planning.

Income Approach : The income approach calculates a value based on the assumption that the value of a business is equal to the sum of the present values of any expected future benefits. In other words, the value is based on the company's future ability to generate income. The two most common methods within this approach are the capitalized cash flow (CCF) method and the discounted cash flow (DCF) method. When historical cash flows are expected to continue in the future the capitalized cash flow method is typically used.

BP is the fourth largest company in the world. In 2009 it had revenues of $239 billion, $235 billion in assets and 80,000 employees. Few companies are better positioned than BP to sustain the financial costs of a major disaster yet remain in business. But since April 20, the stock market has knocked over $70 billion from BP's market capitalization (that is, its fair market value). Investors have sliced BP's value by much more than the likely cost of the cleanup.

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