Business valuation (BV) professionals provide independent, unbiased opinions of value for business concerns of multiple natures and sizes. They also value intangible business assets such as copyrights, employment agreements, trademarks, securities and goodwill. These professional appraisers prepare merger and acquisition studies, employee stock ownership plan feasibility analyses and other similar financial studies. They may be involved in appraisals performed for estate and gift tax returns, buy-sell agreements, securities litigation, equitable distribution in matrimonial matters and many other purposes.
Many ASA-accredited BV appraisers have degrees and/or designations in accounting, financial planning, and the law. When appraising a business, they often work in cooperation with Machinery & Technical and Real Estate appraisers. ASA’s Business Valuation professionals have demonstrated they are “best in class” in business valuation and intangible asset valuation not only in North America, but also throughout the world. A professional receiving an accreditation by the American Society of Appraisers as an Accredited Senior Appraiser (“ASA”) is recognized as having achieved the highest level of education, training, and report writing for business valuations. The ASA designation is the gold standard for a business valuation professional.
Business valuations are important not only when delivered, but also serve as important historical records. As such, the reports must be thorough and complete to stand the test of time. Some of the major areas of business valuations that require professional ASA opinions of value include:
- Financial Reporting – The fair value reporting standards and applications continue to evolve. Valuations are increasingly being scrutinized by shareholders, auditors and regulatory bodies. In many cases, independent fair valuations are required in order to obtain audited financial statements and meet this increasing scrutiny.
- Internal Revenue Service Reporting – In determining the fair market value of an asset for tax purposes, it is increasingly important that the valuation expert read and understand all of the relevant IRS promulgations and Tax Court cases regarding valuation.
- Litigation Support – Business Valuation Professionals provide expert consulting services and testimony in Federal and State Courts, U.S. Tax Court, and at mediation and arbitration. Their opinions are guided by many years of capital markets experience across a wide array of industries, and the ability to develop sound economic models and to convey distinct, credible conclusions.
- Consulting – This includes a variety of advisory services such as Bankruptcy and Reorganization Services, Fiduciary Advisory Services, Litigation Support, Purchaser Representative, and Corporate Advisory assignments.
The valuations follow standard practices but the professional has to determine what approaches and methods apply within these practices and must justify the reasons for their selections. The valuations must be based on assertions of fact proven by a preponderance of the evidence. Where judgment is needed, the basis for that judgment must be explained. For these reasons, the American Society of Appraisers requires not only extensive training and education but also five years of full-time appraisal experience.
The American Society of Appraisers and our chapter are recognized in having the highest standards in education, training, and certification for business valuation. We are dedicated to supporting our members in meeting valuation challenges, mentoring, sharing technical issues, keeping informed on changes in valuation processes and methods, and networking with others to continue to be recognized as the leaders in our profession.