It’s important to regularly get your business valued, especially in this economic climate where conditions can rapidly change. A business valuation is an assessment of what your business is worth and could be a critical factor in helping you get finance, attract business investors or sell the business if it’s on the market.
Getting your business valued by a professional valuer can give you clarity and a comprehensive understanding of the business’s strengths and weaknesses. This in turn can help you make business decisions that increase the profitability of the business and minimise the risks and liabilities.
Over time that could help you increase the value of your business. There are four different methods to valuing a business:
1. Asset valuation method: This is based on calculating the value of the assets and then deducting any liabilities such as bank debts or payments.2. Capitalised earnings method: This is where the valuer will review the average net profit for the past three years with a consideration on market conditions. Then the valuer calculates the anticipated ROI and then divides the anticipated profit by the cost and works out the percentage. Then it will be multiplied by 100 to determine the value of the business.3. Earnings multiple method: This is where different businesses are compared to eachother and then the earnings before interest and tax are multiplied to generate a value.4. Comparable sales method: This is the simplest method and involves reviewing recent sales of businesses in your sector and region.
Valuations ACT is a completely independent valuation company that values businesses in a number of sectors including, but not limited to:
Hospitality and tourism;Retail;Accounting firms;Transport businesses;Medical practices;Mining and mining related businesses;Insurance broker companies;Wholesale trade businesses;Manufacturing companies;Building, construction and engineering organisations;Law firms;Other professional service businesses.
Before you get your business valued, you should prepare relevant information for the valuer including:
Financial statements for the last five years including your latest tax return;Details of assets both physical and goodwill or intellectual property;Legal documents such as leases, insurance policies, business name and ABN registrations, licenses, permits and any other compliance papers;Business information including the market conditions (with an analysis of how you compare to your competitors), sales information, business history, business procedures (with marketing plans, rosters and any other procedures), staff, supplier and customer information;Comprehensive information about wage, salary and contractor expenses.
Although this information helps our Valuers complete their valuations we understand that it’s not always possible. Our Valuers have over 20 years of experience valuing businesses so they will work with the information available.
Valuations ACT valuations are completed to a high standard and the finished reports are accepted by all government agencies and private companies. Our reports have also been submitted to various Australian courts including:
Federal Court of Australia;Federal Circuit Court of Australia;Family Court of Australia;ACT Supreme Court;ACT Magistrates Court;NSW Supreme Court;NSW District Court;NSW Land and Environment Court;Supreme Court of Queensland;Family Court of Western Australia;Supreme Court of Victoria;County Court of Victoria.
Valuations ACT has a brilliant reputation of creating comprehensive and accurate valuation reports so you can be assured that you’re getting a high quality valuation. To set up an inspection time, give our friendly team a call on (02) 6189 2232 or fill out the enquiry form.