Business Valuation Case Study
One area that Avanti can help clients with is to give an indication of how much their business or company is worth; whether to sell, attract investment, maybe get a loan or just to know whether it is all worth it.
- Client X.
- A Limited Company
- Someone interested in buying the company
- Investigations into the value established what the best method to value Company X would be
- A valuation report was prepared that the client can retain, or use to seek the best price possible in any future negotiations.
- Whether or not Company X is sold, at least the shareholders and directors now have some idea of the company’s current worth
- Client received an indication that a party was interest in buying his company.
- Client contacted us for advice.
- We asked pertinent questions of the client to assist in preparing the valuation
- We carried out the initial research by using the power of the internet to make informed comparisons.
- Depending on the research‘s outcome, depends how long the next steps take, but at each point we keep the client informed.
- Following research and obtaining answers to questions we prepared the Valuation Grid to establish what value to put on the Earning Before Tax, Depreciation and Interest
- A report was then prepared explaining fully to the client all of the available methods to value a company, what method we had chosen and why – and of course our opinion as to the value of the company.
So why could you want a valuation?
Maybe like Client X to sell the company, or to know what the shares are worth
What to do if you need a valuation?
- The first thing is not to worry about this. In the end any business is worth what someone will pay for it, but at least you will have an idea!
- Be honest and open with your Accountant – we can’t help you if you are not
- Answer questions as quick as you can. The answers may lead to other questions, thereby delaying the final report
- Make sure you have at least 3 years of accounts available
- Get your paperwork in order, you never know you may just get the offer you want straight away
- Ensure there are up-to-date accounts available, if not ask Avanti to prepare them urgently
So how can Avanti help you?
- By having a qualified/experienced accountant carrying out an informed valuation you get to know where you stand, even before you begin negotiations.
- We help by providing advice about the valuation and if applicable what are the next steps to take.
- We can introduce you to other professionals such as commercial solicitors, business brokers, insurance agents and IFA’s
- At each stage we keep the client informed and nothing is done without their knowledge and approval.