This report is designed specifically for Business Intermediaries and Sellers (internal use) that are looking for assistance in setting a selling price for a small business. Many times, buyers are more confident in placing offers knowing that the selling price is based on a Calculation of Value.
This is NOT inteded for SBA purposes (click for Complete Appraisal).
Intended user: Business Broker or Seller Length: 40-50 pages Turnaround time: 5-7 business days Report Price:Contact Us($125 discount for IBBA members)
The preliminary report has use when a client desires
the appraiser’s limited opinion. These valuations are designed for asset sales of closely-held businesses (less than $2,500,000 in annual revenues).
All Calculation of Value reports are structured in the following manner:
Introduction and Background
National Economic Outlook
Industry Overview and Outlook
Financial Review and Projections
Valuation Methods - Market Approach only
The Market Approach used is the Direct Data Market Method which primarily derives Price to Sales ratios and Price to Sellers Discretionary Earnings ratios from comparable sales. We use transactions from the 3 most popular small business transaction databases: IBA Database, BIZCOMPS Database and the Pratt's Stats Database. The valuation considers historical and current financial performance and assumes that the business will be sold free and clear of any liabilities and debt.
The report is usually 40-50 pages long, depending on the industry type.
According to the Institute of Business Appraisers (IBA), all Calculation of Value reports should minimally set forth in a manner that is clear and not misleading, the following:
Identify the client, and set forth a description of the business
enterprise, security or other tangible and /or intangible property being
Form of the organization and if incorporated, the state of
The purpose (standard of value) of the appraisal.
The function (use) of the appraisal.
The definition of the standard of value that is the purpose of
The effective (“as of”) date of the appraisal.
The date the appraisal report was prepared.
The report’s assumptions and limiting conditions.
All IBBA Members receive a $125 discount on all Calculation of Value reports. Please mentioned your IBBA membership when ordering a valuation.