Business Valuation

In a transaction involving the sale of a business, achieving an independent and reliable valuation of the business is a key component to a successful transaction. Our Valuation service is developed so that you can confidently address the fundamental question of, ‘what is your business worth?’’

The Independent Business Valuation report that is prepared and signed off by Creative CFO is a formal document that can be used for Investment purposes to support the investment case.

Business valuation is a process and a set of procedures used to estimate the economic value of an owner's interest in a business. Valuation is used by financial market participants to determine the price they are willing to pay or receive to affect the sale of a business. In addition to estimating the selling price of a business, the same valuation tools are often used by business appraisers to establish a formula for estimating the value of partners' ownership interest for buy-sell agreements, and much other business and legal purposes such as in shareholders' deadlock. 

In finance, valuation is the process of determining the present value (PV) of an asset. Valuations can be done on assets (for example, investments in marketable securities such as stocks, options, business enterprises, or intangible assets such as patents and trademarks) or on liabilities (e.g., bonds issued by a company). Valuations are needed for many reasons such as investment analysis, capital budgeting, merger and acquisition transactions, financial reporting, taxable events to determine the proper tax liability.

The Valuation process will include:

  • Planning and preparation – Accounting data and financial statement review, business valuation objectives, assembling required information, market research (market multiples, review of similar businesses, etc)
  • Financial statement adjustments (convert to cash flow) – Forecasting, income, and cash flow for the next 5 years
  • Constructing a valuation methodology – Asset, Market and Income approach
  • Applying the selected valuation methods, conclusion, and compiling the valuation report

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