When valuing a private business, there are two techniques that fall under the income approach umbrella. They are the discounted cash flow (DCF) method and the capitalization of earnings method.
In a valuation, historical financial results are only relevant to the extent that the business expects to achieve similar results in the coming years. That’s why, when projecting future economic
Carefully considered business valuations are at the heart of every successful buy-sell agreement. It’s important to think through valuation matters in order to anticipate potential sticking points. When the owners
Recent market volatility may translate into higher discounts for lack of marketability (DLOM). In business valuations, investors generally will pay less for illiquid or risky investments. However, there’s a benefit
There are two basic ways to value a business – going concern value and liquidation value. Many recognize liquidation value from when companies file for Chapter 7 bankruptcy. Your company
The market approach is an intuitive way to value a private business interest. It bases the subject company’s value on sales of other similar businesses or business interests, which are
Business valuation professionals who serve as expert witnesses in court face two daunting tasks: First, they must capture the attention of a judge or jury. Then, they need to make
Charitable contributions can be an effective way to lower taxes for the current tax year, but they don’t necessarily have to be made with cash. Charities also welcome donations of
Intangible assets — such as patents, copyrights, and trademarks — are essential to the operations of many companies, but they’re rarely reported on the balance sheet. And even when they’re
Goodwill is one of the most confusing aspects of valuing a business interest for divorce cases. In many states, goodwill needs to be valued and then divided into two pieces:
