Business Valuation Services Dubai

1.  Home About Us Industry Experience Insights Contact Us Career Accounting  Risk Advisory  Transaction Advisory  Strategic Services  Indirect Tax  Direct Tax  Audit and Assurance  → → ✉ Get a Quote ✉ Get a Quote    Blogs Category  By Slsassociates.Ae  16 October 2023 The Companies / Individuals frequently need to have the business valued. Sometimes it is for a speci?c purpose, such as for sale, acquisition; other times, it might be because of Internal purposes, for the acquisition of shares by a co-owner, or for inclusion in a ?nancial statement. Whatever the reason, there are many ways a business can be valued. Overall, there are a handful of common reasons why business owners need to evaluate the worth of their company: Looking to sell your business Looking to merge or acquire another company Looking for business ?nancing or investors Establishing partner ownership percentages Di?erent business valuation methods will be preferable in di?erent scenarios & best approach will depend on reasons for valuation, the size of your business, industry and other related factors. A business valuation is a set of processes and procedures used to determine the economic value of an entity. There are standards that the business valuation professional must establish at the beginning of the engagement. The ?rst part of a business valuation involves collecting the necessary documents from the client including Transaction details, Historical ?nancial statements, Going forward plans & projections, Debt details & rate of interest, Restricted Cash ?ows. Contact us The next step is to conduct industry and economic analyses, as well as a comprehensive ?nancial analysis of the company. It is important to understand the Pro?t & Loss and Balance Sheet projections carried out by the Management, discussion thereof in case of abnormal trends and adequate documentation in the report. There are three primary approaches that a business valuation professional must consider using during a valuation engagement. These are the Income Approach, Market Approach and Asset Approach. Each of these approaches has multiple methods that can be used to value a business.

2. What are the Methods of Valuation? There are numerous ways a company can be valued & details are given below: 1. Market Capitalization Market capitalization is the simplest method of business valuation. It is calculated by multiplying the Company’s share price by its total number of shares outstanding. 2. Discounted Cash Flow (DCF) Method This method is based on projections of future cash ?ows, which is discounted on the basis of calculated cost of capital considering beta, risk free return, market risk. 3. Book Value This is the value of shareholders’ equity of a business as shown on the balance sheet statement. The book value is derived by subtracting the total liabilities of a company from its total assets. 4. Liquidation Value Liquidation value is the net cash that a business will receive if its assets were liquidated and liabilities were paid o? today. 5. Revenue Multiplier Under the revenue multiplier business valuation method, a stream of revenues generated over a certain period of time is applied to a multiplier which depends on the industry and economic environment. 6. Earnings Multiplier Under the Earnings multiplier business valuation method, earnings generated over a certain period of time is applied to a multiplier which depends on the industry and economic environment. Instead of the revenue multiplier method, the earnings multiplier may be used to get a more accurate picture of the real value of a company, since a company’s pro?ts are a more reliable indicator of its ?nancial success than sales revenue. The ?nal steps of valuation is understanding business valuations relate to the approaches applied to determine the value of your company and the discounts made to reach the ?nal value of the interest.    Next Post  Leave A Reply Name* E-mail* Comment Save my name, email, and website in this browser for the next time I comment. Send Comment Search  Search

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