Larger businesses typically have at least Reviewed Accrual Accounting statements as a valuation starting point. However, smaller businesses rarely have properly reviewed and updated financials. Focus on What Matters looks at the issue of less reliable data, which affects every part of the business valuation. You’ll find valuation solutions for facing this challenge.
As a small business valuator, you can get direction on working with financial statements of lower quality. You can also consider answers to key questions as you explore how to value each small business.
- Is this a small business or a job?
- How much research and documentation do you need to comply with standards?
- How can you use cash basis statements when businesses have large receivables and poor cutoffs?
- Should you use the market method or income method of valuation?
- Techniques that improve reliability of the market method multiplier
- How might you tax affect using the income method with the advent of the Estate of Jones and Section 199A?
- Do you have to provide an opinion of value or will a calculation work?
- How do you calculate personal goodwill?
- As a valuation professional how can you bring value to owners and buyers preparing to enter into a business sale transaction?
- How does the SBA loan process work and why is it essential to current small business values?
- What is the business brokerage or sale process and how does it work?
- How do owners increase business value prior to a business sale?
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About the Author
Table of Contents
Chapter 1 What Is My Business Worth? 1
Chapter 2 Valuation Basics 8
Chapter 3 Why is Valuing Small Businesses Different from Valuing Larger Businesses? 29
Chapter 4 Assessing the Subject Company 37
Chapter 5 Normalization of Cash Flows 81
Chapter 6 Market Approaches 107
Chapter 7 Asset Approaches 145
Chapter 8 Income Approaches 157
Chapter 9 Valuing Partial Interests in a Business 221
Chapter 10 Goodwill and the Small Business 255
Chapter 11 Accounting Issues with Small and Very Small Businesses 265
Chapter 12 Details for Business Valuators 301
Chapter 13 Assisting the Small Business Buyer or Seller 317
Chapter 14 How to Review a Business Valuation 369
Chapter 15 Final Thought 397
About the Website 399