Business Valuations you can rely on

Depending on what is being valued, we will create a work program specific to the job.

For the typical business, it will be the purpose of the valuation, the name of the entity or entities to be valued and some initial financial data – previous year financial statements and current year management accounts or budget. Once we have reviewed these, we will come back and request more specific information.

Some valuations, but not all, use a multiple of earnings approach.

In a limited number of industry sectors and where there are a large number of participants, market transactions give you a guide to what multiples might be. But even in these sectors there is a range.

For other industries the multiple needs to be calculated. The multiple is a measure of the risk profile of the business and its earnings. If you don’t understand the characteristics of the business and its earnings, it’s unlikely that you will get the multiple right. This is where the valuation process makes the difference.

Depending on complexity, most valuations take between 3 and 4 weeks. Process is important and the process takes time to complete.

Talk to us about what is possible and by when.

As with most advisory services, the cost of a business valuation depends on the scope and complexity of the assignment. Cost will vary based on this however we always quote a fixed fee upfront.

With business valuations, you get what you pay for. A quick turnaround, low cost business valuation may not stand the test of scrutiny.

Valuing purely on financial statements is a naive approach to valuation work - financials don’t always give an accurate reflection of the business.

It's a business valuation and as such, financial and non-financial indicators need to be considered.

For example, many SMEs focus on tax when the annual financial statements are prepared. Expenses may be accelerated for the tax benefit, provisions may be ignored. Or what is the effect of a business winning or losing a major contract in the last financial year? When a business is being valued it is the underlying earnings that are important - net profit should not be confused with normalised or maintainable earnings. Normalising earnings will almost always be different to a simple net profit assessment.