I PROMISE to provide our clients with complete information about the business in question, so they can make intelligent decisions.

Why a valuation?

There are many reasons why companies need to be valued, including:

• Acquisition of a business - A valuation will provide the best due diligence available.
• Sale of a business - Reduce negotiating stress by 90%. Present a credible, third party valuation.
• Strategic planning - If you know where you are you can better plan where you're going.
• Securing a loan (SBA or otherwise) - The SBA requires valuations for an acquisition. We're experts in this field.
• Investment in the company - A serious investor wants to know exactly what their getting, a valuation provides it.
• Divorce - Never pleasant, but a valuation can eliminate a lot of fighting.
• Partnership dispute - Same as a divorce.
• Estate Planning - estate taxes may be voluntary, but it does take planning to avoid them
• Retirement planning - will your business provide you the retirement lifestyle you want?

There are almost as many types of valuations as there are situations for their use. Consider one of the following, depending on your client's situation (some have more than one "street name"):

1. Ballpark or Snapshot Opinion of Value - A quick reference when you're curious. The range of value is very wide. This is NOT for determining a transaction price. Definitely not for SBA loans.
2. Value Analysis - A snapshot of the business based on financial information only. The appraiser assumes the supporting factors (customer relations, employee morale and all the others) are conducive to continued profits at the same level.
3. Business Valuation or Price Fairness Opinion - This is the type used for SBA loans, buy-sell transactions, mergers of small companies, strategic planning and similar situations. The difference between a limited valuation and the a full business appraisal is that with a limited valuation, the appraiser takes the word of the client when checking out customers, employees, suppliers, competitors and the other non-financial factors.
4. Business Appraisal or IRS 59-60 Valuation - Used for ESOP's, estate tax, litigation and mergers and acquisitions of large companies. The appraiser will verify all information by auditing books and records and interviewing key people. Often, the appraiser is called upon as a witness to defend his or her conclusions.

These standards come from the Institute of Business Appraisers:

1. Nonadvocacy is considered to be a mandatory standard of appraisal.
2. The essence of business appraisal is a supportable opinion.
3. The appraiser's procedures and conclusions must permit a disinterested party to replicate the appraisal process.
4. The appraiser's duty is to inquire about information that appears to be incomplete or inaccurate.
5. When the appraiser is denied access to data considered essential to a proper appraisal, the appraiser should not proceed with the assignment.