Business & Equipment Valuation

The Valuation Engagement

Sooner or later every business owner needs a reliable company valuation for one or more of a variety of reasons:

An enterprise valuation or appraisal is the independent and unbiased process of determining a supportable opinion of the value of a company, ownership interest, security or intangible assets as of a specified date.

All enterprise valuations are performed by qualified, professional appraisers experienced in all aspects of enterprise valuation and ownership transfers. Our valuations are performed in compliance with the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation (USPAP) as well as the Business Appraisal Standards of the Institute of Business Appraisers. Compliance with industry standards ensures that proven peer-reviewed valuation methods are used to develop defendable opinions of value. Through participation in teleconferences and annual valuation conferences, Murphy appraisers stay abreast of developing valuation issues and related court cases.

Our Valuation Methods include:

• Market Methods – utilizing several different databases of market comps including Pratt Stats, Institute of Business Appraiser’s, Bizcomps, Business Brokers of Florida, and the MidMarketComps database. Multiples of discretionary earnings are used as well as other cash flow multiples. When applicable, sophisticated statistical techniques such as data modeling and linear regression analysis are also used with the market method to provide superior results.

• Income Approach – Single Period Capitalization Method or Multiple Period Capitalization Method (DCF Model)

• Adjusted Book Value Method with Excess Earnings

• Public Company Guideline Method – used for larger companies

• Analysis of prior sales of stock of the company

Then we deliver one of the following:

Enterprise Appraisal Report (Stand Alone Report)

– This report conforms to the Uniform Standards of Professional Appraisal Practice (USPAP) as well as the Code of Ethics and Business Appraisal Standards of the Institute of Business Appraisers (IBA). This report contains a step by step valuation analysis using appropriate valuation methods, a detailed history of the company, as well as a thorough financial analysis of the company which includes financial forecasts, ratio analysis, common size financial statement comparison to industry, and working capital and capital expenditure analysis. This report also contains an economic and industry analysis. Finally, depending on the nature of the appraisal assignment, discounts for lack of control and discount for lack of marketability studies can be included and applied. Approximate Length 60 – 90 pages

Enterprise Appraisal Report (Restricted Use Summary Report)

– This report conforms to the Uniform Standards of Professional Appraisal Practice (USPAP) as well as the Code of Ethics and Business Appraisal Standards of the Institute of Business Appraisers (IBA). This report contains a step by step valuation analysis using appropriate valuation methods, but does not include a detailed history of the company, economic and industry analysis, or a detailed financial analysis of the company. A summary financial analysis of the company is included. Approximate Length 40 – 60 pages

Updated Report

– Usually done every few years or as necessary. This report contains all the same information as the original report and conforms to the same standards and is simply updated based on the company’s latest financial information, market conditions, and changes in the economy.