Many business owners believe the value of their business is measured in net profit or gross sales, multiplied by an industry rule of thumb. This is simply not the case. In fact, the application of an industry rule of thumb formula often results in a value determination that differs greatly from the actual value that we could help you determine. The result of an inaccurate valuation, regardless of whether it is high or low, generally leads to undesirable consequences. Let us help you keep what you have worked so hard to build by assisting you with a business valuation prepared by a credentialed professional.
CMP has experienced business valuation experts to help with your business valuation needs, from support in executing a buy-sell agreement, acquiring a business, or selling your business. Our valuation specialists have gone through extensive training and continuing education to be on the cutting edge of business valuation techniques and trends. The Certified Valuation Analyst (CVA) credential is widely recognized and accepted in the business valuation industry, and meets the standards of professional credentials for a broad spectrum of authorities, including the IRS and various courts. Our valuation services are subject to the professional standards as set forth by the American Institute of Certified Public Accountants (AICPA) and by the National Association of Certified Valuators and Analysts (NACVA).
Some of the Business Valuation services we offer are as follows:
Purchase, Sale, Merger of a Business
– We specialize in determining what a business is worth. This can be of great assistance in negotiating a sales price or a purchase price of an interest in a business. We can also help you identify strategic benefits that may be available to mergers and acquisitions, as well as quantifying the value of the combined entity.
Buy-Sell Agreements and Succession/Exit Planning
– It is generally recommended that an independent third party prepare a business valuation when a Buy-Sell agreement is exercised. This significantly reduces the likelihood of disagreements among business partners and eliminates each party’s bias from the transaction.
Family Limited Partnerships (FLPs) or LLCs
– It is common to have transfers and other transactions among family members that require a business valuation to meet certain standards under the Internal Revenue Code and related regulations. We are experienced in preparing business valuations of FLPs and FLLCs and we have the professional credentials that meet the IRS’ standards for being a “Qualified Appraiser”.
Business Valuations for Gift and Estate Tax purposes
– We are able to combine our expertise in Estate and Gift Taxation with our expertise in Business Valuations to prepare business valuations that meet the IRS’ standards for Gift and Estate reporting purposes. These valuations are required in many instances, and can be used to establish the stepped-up basis in closely held investments.
Charitable Contributions of a Business
– Sometimes a taxpayer may choose to donate all or part of their business to a qualified tax-exempt organization. In order to qualify for the income tax deduction for making a non-cash donation of a business interest the IRS requires the donor to obtain a “qualified appraisal”. We are both experienced and qualified to prepare business valuations that meet all of the IRS’ required standards for charitable donation reporting.
Marital Dissolution or Business Partner Disputes
– Unfortunately, not all marriages last and not all business relationships are ideal. If you find yourself in a dispute that involves an interest in a closely held business we can assist you by preparing a Business Valuation that can be used to help settle the dispute.
Company Monitoring and Benchmarking
– It is often said that you can’t manage what you can’t measure. With our business valuation services we can help you monitor the progress of your business over time by preparing periodic business valuations. These business valuations can be used to measure company stock performance for closely held businesses and can be used as a tool to benchmark your company against other companies in your industry.
– For the business owner that doesn’t have a need for a full-blown business valuation, we offer other related services ranging from a calculation engagement to specific agreed upon procedures to business consulting for a business that is expected to be sold at a future date. In fact, by utilizing the principles of business valuation we can help you to make sure your business operates in a manner that will yield the highest sale price when it does come time for you to sell the business.