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BUSINESS VALUATION CHECKLIST
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Gathering and preparing data is a crucial step in completing a proper and accurate valuation. Though it may require substantial time and effort to gather the information, a data request from your valuation advisor will be tailored to the purposes and needs of your valuation— whether it’s for the sale of the business, tax purposes, divorce, or other reasons—to ensure that relevant valuation models can be implemented.

Provision of accurate data will also help in addressing any relevant risks in the valuation approaches used in the appraisal. Once the data is received by your valuation advisor, it will be checked for consistency and accuracy, and additional information may be needed to resolve any discrepancies.



The following list, while not exhaustive, contains the information necessary for compiling an accurate valuation in most cases.


 

  • Financial statements for the last five fiscal years, including balance sheets, income statements, schedules, and record of cash flows.
  • Most recent interim and fiscal year-to-date financial statements, including detailed balance sheet and income statements. Include statements for the same year-to-date period of the previous fiscal year.
  • Any budgets, forecasts, or business plans or projections which have previously been prepared.
  • Copies of all existing contracts, including the following:

Franchise agreements
Supplier agreements
Distributorship agreements
Customer agreements and contracts
Lease agreement, if business premises are not company-owned
Loan agreements with banks or other lenders
Non-compete agreements
Any other legal agreements or contracts

  • Business ownership, including all partners or LLC members, and their ownership stake. If the business has shareholders, list by class, if there are multiple membership classes.
  • Terms, purchase prices, and any written contracts related to transactions in company membership interests.
  • Information regarding past, present, or potential future offers to buy or sell part or all of the company’s membership interests, shares, or assets, even if only preliminary. This includes disclosure of discussions with any potential buyers and information on offers received; any marketing information or other documents prepared to solicit purchasers for a public or private offering of membership interests, shares, or assets, or to raise venture capital or financing; and copies of business plans prepared for potential buyers, investors, or lenders.
  • Information on related party transactions.
  • All contingent assets or liabilities not reflected on the balance sheet, such as:

Pending or threatened lawsuits
Regulatory compliance requirements
Warranty or other product liability
Hazardous waste/environmental liabilities
ERISA claims or problems
OSHA citations
IRS disputes, audits, or tax liens
Letter of credit liabilities
Judgements or liens
Company obligation guarantees
Pending, threatened, or actual default—or acceleration of leases, loans, or financing agreements, or non-compliance with loan, lease, or financing agreement terms and conditions
Any other assets or liabilities not shown on the company’s balance sheet as of the valuation date

  • Information related to:

Recent, pending, or possible future loss of customers, distributorship rights, key product lines, suppliers, or financing sources
Recent, pending, or potential future additions of key product lines, customers, suppliers, distributorship rights, or financing sources
Recent loss of key employees that may damage the value of the business through a loss of revenues or result in establishment of a competing company
Pending or potential acquisitions of other companies or assets

  • Existing assessments of asset values, including latest property tax assessments and real and personal property appraisals of company assets.
  • All assets and liabilities not used in daily business operations, including investments or real estate, marketable securities, assets held for personal use or sale, and cash value of life insurance.
  • Information on non-recurring income or expense items in the last five fiscal years prior to the valuation date.
  • Any other material factors that impact or potentially impact the company or its value as of the valuation date; a discussion with a business valuation expert will help to identify any potential additional factors.
  • Patents, copyrights, or trademarks held by the company.
  • Revenues and gross profit by product from the last fiscal year prior to the valuation date.
  • Current appraisals of company-owned real estate, prepared by state-licensed and certified appraisers.
  • Any additional information that may be required to calculate an accurate valuation for a specific case; a business valuation expert briefed on the history, financial data, and specifics of the company can specify the additional information needed.

Get An Accurate & Defensible Valuation With Taqeem


Calculating the value of a business or its assets requires not only accurate financial information, but also the expertise of valuation professionals experienced in calculating defensible valuations. Without that, it becomes little more than a guess or wishful thinking. Taqeem’s team of business valuation experts have worked with some of the world’s largest companies and are uniquely qualified to calculate fair and defensible valuations. Get in touch today to discuss your business valuation needs.


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