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  "documentTitle": "Sino-Forest Corporation (TRE)",
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  "notes": "The slide uses footnotes to cite specific pages of the Poyry report to undermine the credibility of the valuation.",
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      "kind": "callout",
      "text": "Do You Think a 2.5% Risk Premium on TRE's Discount Rate for WACC Seems a Little Low?",
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      "text": "In short, due to the poor quality of data and documentation on the forest plot, until there is an opportunity to both verify the forest's physical characteristics and use satellite imagery on all forest claims, that the sample sizes are too small to establish significance.",
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      "text": "The reliability of forest descriptions; The accuracy of yield prediction; Achieving high growth rates in a consistent manner",
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      "text": "The Poyry report explains that its review of forest land holdings consisted of selecting 66 cluster maps that represented only 1,611 ha of forest, or only about 0.3% of TRE's claimed 491,000 ha.",
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      "text": "Poyry's 2009 report includes an appendix detailing the calculation method for the discount rate, WACC, and CAPM... Dr. Marsden repeatedly emphasizes the need to keep in mind the additional risk associated with developing markets...",
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      "text": "In introducing its methodology for assessing risk into the discount rate calculation, 2009 Poyry explains that the valuation of forest crop assets faces challenges, including:",
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      "text": "In China and in emerging markets the level of corporate governance may vary significantly between companies. Corporate governance is important as it provides mechanisms whereby outside investors can protect themselves against expropriation by insiders. Corporate governance can impact on the risks that outside investors may face in respect of any expropriation of assets. These factors together with the size and other market frictions may warrant an adjustment to the cash flow expectations and/or an — Dr. Mardsen, University of Auckland",
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      "text": "58-62: Citations of Poyry, Sino-Forest Corporation Valuation of China Forest Assets reports.",
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