The International Glossary of Business Valuation Terms defines valuation as: “The act or process of determining the value of a business, business ownership interest, security, or intangible asset”

Valuation services and applications are in a perpetual state of evolution. Business appraisers are valuing businesses and business interests that did not exist a few years ago.

Businesses once considered a local “Mon & Pop” business operating in a small rented office in Any Town U.S.A. can now be an international business via the internet.

Traditionally, a large portion of a business’s value was in the fixed assets of the business. Today, it is commonplace to find very valuable businesses that own virtually no tangible assets. Intellectual and proprietary assets are the economic engines driving today’s business values.

The following lists are some, but not all of the services, applications, and standards of value you are most likely to encounter in today’s operating environment.

 

Valuation services:

  • Detailed valuation reports
  • Summary reports
  • Oral reports
  • Restricted use reports
  • Valuation report reviews
  • Business damages
  • Consulting
  • Goodwill impairment
  • Expert witness
  • Other

Applications for business valuations

  • Gift and estate taxes
  • Mergers and acquisitions
  • Business succession planning
  • Exit strategy planning
  • Buy/sell agreement
  • Eminent domain (condemnation)
  • Stockholder/shareholder dissention and oppression
  • Stock/share offerings
  • Marital dissolution
  • Bankruptcy reorganization
  • Financing (loan applications)
  • Insurance claims
  • Impaired goodwill
  • Other

Standards of value

  • FMV (fair market value)
  • FV (fair value)
  • Market value
  • Insurable value
  • Collateral value
  • Investment value
  • Intrinsic value
  • Loan value
  • Synergistic value
  • Owner’s value