Close-Up On The Cost Approach
The cost (or asset-based) approach to valuing a business focuses on the balance sheet. This financial statement reports ‘book values’ for the company’s assets and liabilities. Here’s how the cost
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Category: Valuation
When Subsequent Events Count
The value of a business interest is valid as of a specific date. The effective date is a critical cutoff point because events that occur after that date generally are
Risky Business: What Factors Into The Cost Of Capital?
Valuation experts often use discounted cash flow (DCF) techniques to determine the value of a business or estimate economic losses. A critical input in a DCF model is the cost
Taking Marketability Discounts On Controlling Interests
In a business valuation context, the term “marketability” refers to the ability to quickly convert property to cash at minimal cost. While publicly traded stocks are readily marketable, interests in
Tax Affecting & Valuing A Pass-Through Business
Most U.S. businesses operate as so-called “pass-through” entities, including partnerships, limited liability companies, and S corporations. For decades, the IRS and valuation professionals have been at odds over how to
Six Steps To Prepare Your Business For A Sale
The COVID-19 pandemic has put unprecedented stress on private business owners. Some are now considering selling their businesses. Before putting your business on the market, it’s important to prepare it