Business Valuations

The Business Valuation Process

Understanding what a Business Valuation is an important step in selecting the professional best-suited to fulfilling your business valuation needs. Business Valuation is a discipline and should not be regarded as either an art or an exact science nor is a business appraisal a finding of fact. The Business Appraiser values the subject interest in the business through a logical evaluation of relevant factors using a framework of financial analysis, technical approaches, methods and procedures on data, facts and hypothetical assumptions that are individually and, in toto, consistent, relevant and generally accepted.

  • Defining the Engagement
    • The business valuation (BV) professional works with the client to carefully the scope and intended use of the valuation.
  • Gathering Data
    • The client works with their advisors and the BV professional to gather the company information required for the valuation.
  • Analyzing Economic and Industry Background
    • The next stage is that we analyze the relevant economic and industry background that will affect the business, getting empirical data that can be used to evaluate the company prospects. Never accept shortcuts, fingers in the air or “canned” reports at this stage – lack of care on the part of an appraiser in analyzing the economic and industry factors reduces the validity of the conclusion, totally undermines the credibility of the valuation and short-changes the client.
  • Analyzing the Company
    • Now we take the information and data gathered and apply financial and business analysis techniques to identify the key drivers of the business, their relative importance, enterprise performance against the industry benchmarks and evaluate the future prospect for the future. This requires a high level of skill in business analytics and financial projections derived from technical knowledge and experience of investing, management and business valuation techniques.
  • Determining the Value of the company using BV techniques
    • The same high level of ability in financial analysis and up to date business valuation methodology to value the enterprise using a number of different methodologies and reconciling the results using assumptions and facts based as much on empirical data and research as possible. Business Valuation is not a science and some level of subjectivity is always present but should always be backed up with a well-researched and valid rationale.
  • Analyzing & Applying Discounts and Premiums
    • We now use the capital structure of the company to value the interest in the business, whether it is the equity, the enterprise value or a fractional portion of the business. It is here that we apply any appropriate discounts and premiums which must always be derived from logical thoughtful and up-to date analysis and facts to be valid and credible.
  • Producing Report
    • Whatever the level of report detail specified in the engagement definition, the same detailed and careful analysis must be for the sake of the integrity of the valuation, the client and the evaluator. A logical well-structured report on the opinion of value is useful not only for the estimate of value but to clearly understand the drivers of the valuation.

We are reliable, practical and approachable people who hold themselves to the highest standards and take pride in using our business and analytical skills and experience to deliver the most useful product of the highest quality and integrity. Your business valuation will be conducted according to the arguably highest standards in the industry, the Business Appraisal Standards of the Institute of Business Appraisers.

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