Specialized Business Valuation Services in Las Vegas

While most people seek a business appraisal during the sale or purchase of a business, there are many other reasons why you may need an evaluation report. For instance, you’ll need a valuation report to ensure equal division of the company’s assets in the event of a partner’s demise, disability, divorce, and more.

Here are some more instances when you will need a company valuation:

1. To settle internal (among partners and shareholders) and external (with the Internal Revenue Service) disputes.

2. When donating the company’s shares to a charity.

3. At the time of switching your firm from a C-corp to an S-corp and vice versa.

4. To comply with the agreed terms of partnership, shareholding, sale, or purchase.

5. To raise strategic capital or apply for a Small Business Administration loan for a small to medium-sized company.

6. To develop a clear understanding of your business’s exact fair market value in the existing market situation.

Looking to conduct one such business valuation in Las Vegas or anywhere in Nevada? You can reach out to our appraisal experts and learn about our business valuation services.

The business valuators can ask for some important documents with details of your company’s financial information, including:

1. The statements of profits and losses, balance sheets, and tax return filings of the past five years.

2. The statement of profits and losses, balance sheet, and tax return filing for the present year.

3. Any document/s that details your company’s upcoming projects and future growth projections.

4. Further, the evaluators can also ask for documents with details of your company’s products and services, assets and liabilities, etc.

There are three basic methods or approaches to conducting a business valuation, which includes:

1. Asset-based method

2. Market value method

3. Earnings method

The asset-based method

This method calculates the total value of your business based on its assets. However, it is noteworthy that the asset-based approach or method does not consider various criteria like the earnings of the company, flow of cash, etc.

The best way to calculate the value of your business under the asset approach is by factoring in each and every asset of the company and its collective value. That will include both tangible assets like property, equipment, invoices, accounts, inventory, etc., as well as intangible assets like the goodwill or reputation of your firm on the market.

After deriving the fair market value of all these assets, you should take the value and deduct from it the total value of liabilities. This way, you can have the net asset value of your company.

The asset-based method is apt for such companies that have a large number of assets, for example, manufacturing industries. Also, those businesses that aren’t making profits but hold significant assets can go for this business valuation method.

The market value method

This method can help you get an approximate figure of what a prospective buyer will willingly pay to buy your company. Herein, the business appraisers will factor in things like your firm’s financial statements, its standing, and competitiveness on the market, brand value, as well as the prevailing market scenario.

The market value method or approach to business evaluation can be worthy for both public and private firms; here’s how:

• You can use the method to calculate a public entity’s current share prices, thus calculating its market value.

• For a private entity, the market approach provides you with various parameters like comparable sales data and earnings multiples, among others, to establish its market worth.

In fact, if you want an easy-to-understand and quick-to-use method to calculate a firm’s value, the market value approach should be your one-stop solution.

The earnings method

To put it simply, the earnings method in business appraisal analyzes the past and present earnings of a company, along with its future earning potential. This is, indeed, one of the most sought-after approaches to calculating a firm’s total value.

The method, in particular, is highly preferred among publicly traded companies since information about their financial records is available in the public domain.

When using this method to calculate a business’s value, you’ll need to study its future earning potential and discount them with the present-day value of the firm.

Here’s a catch with the earnings method:

To derive an accurate value of the firm being evaluated, one needs to ensure that the rate of discount is reflective of potential risks in cash flow.

Talking about the cost of business valuation, it’s worth understanding that there isn’t one fixed charge. As such, the cost can vary depending on multiple factors, starting right from the appraisal firm itself.

Nevertheless, here are two key factors that greatly influence the valuation cost:

1. Business appraisers and appraisal firms charge you in two ways, i.e., an hourly fee and a fixed valuation charge. So the total amount you spend on company valuation can vary depending on the two.

2. The cost of business appraisal also depends on the size of your company, the industry it operates in, and the intended purpose of evaluation.

Taking into account both factors, you can expect to pay anywhere between $5000 and $50,000 to avail business valuation services in Las Vegas.

A team of certified valuators can take from a few days to up to two weeks to complete the business appraisal in Las Vegas.

To know about the timeframe of valuation for your business in Nevada, you can reach out to our business appraisal experts.

If you’re looking for a highly seasoned team to conduct an evaluation of your business, you should look for experts with designations like Certified Company Appraiser (CCA) or Accredited Senior Appraiser (ASA). Such a team can create an estimation or valuation that is legally enforceable.

Nonetheless, you can also go for people with qualifications like Certified Valuation Analyst (CVA) and Accredited in Business Valuation (ABV).

A complete business evaluation is essential to know the true worth of your company. And that’s simply not possible with the free sources available online.

When you seek paid services of an experiencedbusiness appraisal expert, you avail the right information and also the required guidance in making strategic decisions.

A major drawback of company valuation reports is that they are often disputed by different parties and, at times, even rejected.

Not to mention, in terms of price justification, test valuation reports are always under challenge. The price justification test determines if a company’s flow of cash is enough to cover taxes, debt, and ROI for investors.