A business valuation is the independent and unbiased process of determining a supportable opinion of the value of a business, business ownership interest, security or intangible asset as of a specified date.
Business sales, mergers, acquisitions, re-organizations, spin-offs, liquidations and bankruptcy.
Allocation of purchase price (tax and financial reporting)
Estate, gift and income taxes
Incentive stock option considerations
Initial public offerings
Eminent Domain actions
There is a considerable amount of competition among business valuers. There are a growing number of full time valuation analysts in the business, but they are outnumbered by the part time valuation analysts who spend much of their time in other areas. These analysts include business brokers, college professors, commercial real estate appraisers and investment bankers. There are even websites that produce a business valuation based upon data you input. There are a number of organizations that offer accreditations in business valuations, including the American Institute of Certified Public Accounts (AICPA), which issues the Accredited in Business Valuation (ABV) designation to CPAs who have met strict criteria.
To become an ABV, one must hold a valid CPA certificate and be a member in good standing of the AICPA. In addition to the rigorous requirements to become a CPA, an ABV candidate must pass an additional exam and meet experience requirements before being granted the ABV designation. CPA/ABV’s must also meet annual continuing education requirements to ensure they are staying abreast of changes in the field.
Walter J. Kero and Mark Byington have over 50 years’ combined experience as CPAs in Missoula and have performed tax, accounting and valuation services for a wide variety of small and medium size businesses. To properly value a business, the valuator must understand the business. This involves both analyzing the financial numbers and evaluating the intangibles and unique circumstances that affect your business’s value.
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