Business Valuation – Know Your Worth
Knowing the value of your business is key to making tough decisions in the marketplace. Determining partnership, sale value, tax preparation, and more can all be aided with an accurate valuation of your business. Inaccurate business valuations can lead to ill-informed decisions and may even doom a business in the long-term.
Sovereign CPA uses a variety of techniques and calculations to determine the value of all kinds of businesses, regardless of size, type, or industry. If you need your business evaluated by experts, Sovereign CPA is the firm for you!
What Is Business Valuation?
Business valuation, in layman’s terms, is simply determining the value of a business using a variety of factors like market share and value of assets. There are many metrics by which companies can be valued, which can all be used to paint a clear picture of the business.
Contrary to popular belief, business valuation is an important tool not only for selling the company but for a variety of business-related tasks and decisions. To that end, we use our analysis techniques to help business owners navigate those tasks and decisions to find the most success.
Pros Of Expert Valuation
In addition to determining how much to sell a business for, all of the below situations are aided by an accurate valuation of the company:
- Estate and gift tax return compliance
- Tax planning/compliance
- Insurance purposes
- Divorce litigation
- Litigation, fraud, and forensic accounting
- Buy-sell agreements
- Shareholders disputes
- Succession planning
- Employee Stock Ownership Plans (ESOPS)
These are just a few of the business situations where a good valuation is helpful or even crucial to success. For decades, our CPAs have worked with dozens of industries, mastering the craft of business valuation and fostering long-term relationships with our clients.
How We Approach Valuation
Determining the value of a business is typically done using three main metrics: assets, earnings, and market share/influence.
Asset-based valuation most often takes the value of all the capital owned by the company and subtracts the liabilities from that total. Earnings-based valuation takes into account the past earnings of a company as well as projected future earnings to estimate value, often for investors. Market valuation uses the value of similar companies in similar markets to determine the value of the business being evaluated. We utilize all of these approaches to determine the most accurate value of businesses.
Business valuation is as much an art as it is a science. Sovereign CPA has provided accurate and timely valuations for clients in Birmingham and beyond.
The Benefits Of Our Valuation Services
Our business valuation process is predicated on expertise and a client-centric focus. Since business valuation can be a multi-faceted and complex process, expertise and cooperation are key to a successful valuation.