25 Factors Affecting Business Valuation

Financials

Financial documents of a company prepared for tax filing purposes is the purview of accounting professionals who have the relevant training and experience for that work.

Normalizing financial documents prepared for tax purposes for use in a business valuation; requires an entrepreneurial valuator with prior long term relevant business owner operator experience

An entrepreneurial valuator has no doubt bought and sold Intangible Assets. This is what gives them the extra experience required to normalize assets to correctly determine “fair market value” as required in the Canada Income Tax Act Policy Paper.

Business experience is going to suggest to the entrepreneurial valuator that the balance sheet inventory of boats in late September will need to be discounted as opposed to a May 1 effective date of valuation. Relevant business experience is going to help the entrepreneurial valuator to effectively and accurately determine and adjust fair market wages in the normalization process for the profit and loss statement. These are just two of the many normalizations that are the purview of entrepreneurial business valuator.