The process of determining the worth of a business, business ownership interest or intangible asset. To do this, all assets and liabilities of a business that contribute to value are examined including tangible assets such as property and equipment and intangible assets such as brands, copyrights and business goodwill.
Fair market value is defined as:
The highest price available in an open and unrestricted market between informed and prudent parties, acting at arm’s length and under no compulsion to act, expressed in terms of cash.
In valuing a business (whether shares or assets) there is no single, standard or specific mathematical formula. The particular approach and the factors to consider will vary in each case.
The experts at Vine Valuations Inc. undertake a continuous rigorous course of academic study and have many years of practical experience.
Each expert is designated a Chartered Business Valuator (“CBV”)- the designation recognized by the Canadian Institute of Chartered Business Valuators as the pre-eminent designation for valuation assessment in Canada.
The Canadian Institute of Chartered Business Valuators recognizes three types of valuation reports. Each involves a progressively more detailed review of the business and its underlying financial records and an increasing amount of disclosure. The more detailed the review and the greater the disclosure, the higher the level of assurance. The type of report is largely driven by its intended use.
| Report Type | Comprehensive | Estimate | Calculation |
|---|---|---|---|
| Industry | Yes | No (But We Do) | No |
| Economy | Yes | No (But We Do) | No |
| Site Visit | Yes | Maybe | No |
| Review Level | High | Medium | No |
| Corroborated | Very Well | Yes | No |
| Report | Very Detailed | Somewhat Detailed | Brief |
| Assurance | High | Medium | Low |
