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Michael Bilby

Recent Posts

Calculation or Valuation Engagements – Which is Best for Your Business?

Posted by Michael Bilby on Thu, Nov 29, 2018

When it comes to business valuations, not all valuation reports are created equal.

In fact, the professional standards for both the American Institute of Certified Public Accountants and National Association Of Certified Valuation Analysts specify two distinct types of valuation engagements: a calculation engagement and a valuation engagement.

While the reports produced by both engagements share many common characteristics, it is important for business owners to understand the key differences and appropriate uses with each engagement.

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Topics: Business Valuation

Buy-Sell Agreements are a Must for Closely-Held Business Owners

Posted by Michael Bilby on Tue, Oct 2, 2018

For closely-held businesses with multiple owners, it’s certainly a best practice to have a buy-sell agreement signed and in place.

A buy-sell agreement is a contract between the co-owners of a business which stipulates the terms and conditions for the buyout of an interest in the company should one of the owners need to leave. Simply put, the agreement acts as a sort of “pre-nup” between the owners that addresses the exit conditions in the event of an owner’s death, divorce, disability, personal bankruptcy or violation of a company contract or policy.

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Topics: Business Valuation

Business Valuation Methods: Pros & Cons for Business Owners

Posted by Michael Bilby on Thu, Jul 12, 2018

Valuing an interest in a closely-held business is often more art than science. There is no perfect calculation or analysis that can always answer the question “What is it worth?”

While there are certainly subjective elements to any business valuation, there are three main approaches to valuation that are widely accepted and most often used by Certified Valuation Analysts (CVA) and other professionals that perform such services. These approaches are the asset or cost based approach, the income approach, and the market approach.

Let’s look at the pros and cons, as well as situations where their use is most appropriate.

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Topics: Business Valuation

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