Business valuation reports are not done often, and that’s not without good reason. They are a huge undertaking, the ultimate measurement of a company’s worth, value and potential, which goes far beyond the numbers, and can have a massive impact on the outcome of major company decisions and directions. And, because of this, it’s not just anyone who can draw one up comprehensively, accurately and competently. A good business valuation report requires the services of the right professionals who prepare business valuations in Dubai.
Elements of a Good Valuation Report
Identification of the Business and Reason for the Valuation
The most common situations which call for a business to be evaluated include it’s being part of an estate, divorce settlement, the break-up of a partnership, liquidation or litigation; or it can be because the owner is looking to sell it, or attract new investors to expand. These affect the value/s determined in the course of the valuation report, which can include fair value, fair market value, strategic value and liquidation value, depending on the reason for valuation.
Description of the Business:
This section of the valuation report involves full understanding of the type of business involved and how it operates, its organisational structure, and the management team which runs it. It also reports on how equity ownership is shared and provides a careful analysis of the business in terms of both its weaknesses and its strengths, the opportunities it offers, and the threats it is likely to face.
Any misunderstanding or error could jeopardize the accuracy of the final report and the standard value determined in it, which is why a valuation report is best outsourced to an expert who provides business valuation services in Dubai.
Financial Statement Analysis:
Business performance in the past and present can provide an idea of what cash flow levels can be expected in the future. This takes into account the size and financial profitability of the business and how they compare with the overall picture of the industry in which it operates. On occasion, the valuator will make the necessary adjustments when once-off items or discretionary ones might paint an abnormal picture of the current cash flow.
Trends in the Industry and the Economy:
However, there’s a balancing second step the evaluator has to take when comparing the business to the industry in which it operates. While that gives some idea of its past and current value and hints at its future potential, the state of the industry itself, and the general economic environment, can also either put the brakes on potential growth or place their foot on the accelerator, so influencing the value of the company.
Why Xcel is the Right Choice for Getting a Business Valuation Done
Xcel provides valuation services along with its bookkeeping and accounting services in Dubai. As professionals, we have access to the training and information necessary to compile business value reports that meet the required standards, and they are completely objective when determining the true value of a business.
