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  "documentTitle": "Burford Capital Ltd. (BUR LN)",
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  "authorName": "Carson C. Block",
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  "presentationDate": "2019-08-07 00:00:00",
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  "notes": "The slide uses a deductive reasoning approach to challenge the company's accounting practices by comparing cumulative Fair Value Movements to balance sheet Fair Value Gains.",
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      "text": "Clearly, the Net Realized Gains amount of $87.2 million was the profit above its invested capital, and not above the Carrying Value. Therefore, it is clear that Net Realized Gains are Proceeds minus Invested Capital.",
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      "text": "Clearly, the Net Realized Gains amount of $87.2 million was the profit above its invested capital, and not above the Carrying Value. Therefore, it is clear that Net Realized Gains are Proceeds minus Invested Capital.",
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      "text": "Realized gains are straightforward: they represent the amount of profit, net of the return of Burford's invested capital and any previously recognized unrealized gains, on an investment that has either resolved entirely or has been settled or adjudicated such that, in Burford's view, there is no longer litigation risk associated with the investment.",
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      "text": "First, BUR's disclosures on Teinver makes clear that BUR booked previously recognized Fair Value Gains as part of the Net Realized Gain. BUR disclosed that its 2018 Net Recognized Gains included $87.2 million from the sale of its Teinver claim. The sale proceeds were $100 million. At the time of the sale, BUR's Carrying Value for Teinver was $69 million. That Carrying Value included a Fair Value Gain of approximately $56.2 million, given that BUR's invested capital was $12.8 million.",
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      "text": "The second way to know that Net Realized Gains are Proceeds minus Invested Capital is by comparing the cumulative Fair Value Movements since BUR's inception to the value of Fair Value Gains (a/k/a Unrealized Gains) on its balance sheet. If BUR's accounting for Net Realized Gains matched the description BUR gives of how Realized Gains work (i.e., Proceeds minus Carrying Values), then the cumulative value of Fair Value Movements would greatly exceed the Fair Value Gains currently on BUR's balance sheet.",
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      "text": "However, BUR's cumulative Fair Value Movements roughly equal the Fair Value Gains on its balance sheet. We calculate BUR's cumulative Fair Value Movements through December 31, 2018 to be $591.0 million. BUR discloses that as of December 31, 2018, the Fair Value Gains as a percentage of its $1.6 billion of its Investments is 39%, which is roughly $621.0 million.",
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      "text": "Footnotes 83-88 detailing Burford 2018 Annual Report and Teinver-related disclosures.",
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