Corporate Finance

Business Valuation

A business valuation is a formal process to estimate the value of a business. It relies on the professional judgment of an analyst who weighs the nature of the business, its financial performance, local and national economic conditions, values of assets and related liabilities.

We at Hatem Audit Firm undertake the process of determining the present value of a company or an asset. It can be done using a number of techniques. Analysts that want to place value on a company normally look at the management of the business, the prospective future earnings, the market value of the company’s assets, and its capital structure composition.

Business valuation to a company is an important exercise since it can help in improving the company.

Reasons for Performing a Business Valuation

Business valuation to a company is an important exercise since it can help in improving the company. Here are some of the reasons to perform a business valuation.

* Litigation

During a court case where there is an issue with the value of the business, in case of damage, the company’s worth is provided and based on the actual worth of your businesses.

*Exit strategy planning

A valuation keeps the business ready for expected or unexpected sale, this is based on annual updates that gives precise information of the company’s fair market value.

*Purchase of a business

A business valuation will point out the efficiency of an investment by considering the market conditions, potential income and other similar concerns to ensure the process.

*Selling of a business

A business valuation shows the worth of the company in the case of selling to third party. *Strategic planning

A current valuation of the business will give you good information that for better business decision making.


Professional documentation of the company’s worth is usually required since it enhances the credibility to the lenders, especially for financial institutions.

*Selling a share in a business

For business owners, proper business valuation enables to know the worth of shares in order to be sold in good value.