Tag: Valuation

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:

Limited liability companies (LLCs) sometimes award employees and contractors a unique form of equity-based compensation known as “profits interests.” These interests aren’t actively sold on a public market, so a

Summer can bring extreme weather, including floods, droughts, wildfires, tornadoes, and hurricanes. These natural disasters and other crises can interrupt normal business operations, causing significant financial losses. If disaster strikes,

Reasonable (or replacement) owners’ compensation can be a hot button during IRS audits, divorces, shareholder disputes, and other litigation matters involving the value of a private business. What’s appropriate depends

The balance sheet — which shows a company’s assets and liabilities — is a logical starting point for valuing certain types of businesses. The cost (or asset) approach specifically focuses

When valuing a business using the discounted cash flow method, residual (or terminal) value is a key component. The International Valuation Glossary — Business Valuation defines residual value as “the

Employee stock ownership plans (ESOPs) provide tax-saving opportunities for business owners who want to cash out and transfer ownership to employees without immediately giving up control of the business. However,

In mergers and acquisitions (M&As), there are buyers who are willing to pay a premium above the fair market value of the business on a controlling basis. This premium typically

Valuing a private business is a complex endeavor. But, when all is said and done, valuation analyses boil down to three general approaches. 1. Market approachUnder this approach, valuators derive