Valuation is at the heart of every business and investment decision. A professional valuation can ensure that you don't sell investments for less than full value, or overpay when you acquire them. The professionals at Enterprise Value Advisors (EVA) are dedicated to producing thorough, reliable, and completely documented valuation reports. Our expertise in valuation methodology and economic analysis enables us to provide our clients with accurate, objective, and realistic valuations and insightful strategic plans. We will apply our financial expertise to your existing enterprise and plans to facilitate better business and investment decisions.
Valuing a professional practice is a complex and difficult process because many of the practice's assets are intangible, and often the most important assets go home every night. That is, much or most of a practice's intangible value is not reported on a firm's balance sheet - this is often described as professional goodwill. Moreover, the typical cash-basis operations of professional practices can complicate the valuation process further. Finally, the question of what is being transferred and what is being valued is often mishandled. Due to these complexities, valuing professional practices requires additional adjustments beyond the adjustments typically included in a business valuation.
EVA has experience valuing professional practices (medical, dental, and legal) and can help you or your clients with valuation concerns and issues. Furthermore, we understand options valuation and can help you understand how to design contingent payments and delayed consideration in the valuation process so that your professional practice is properly and objectively valued.
Estate planning involves the synchronization and balancing of several potential concurrent objectives: tax management, liquidity (to pay for any taxes incurred), leadership continuity for the business operations, ownership continuity among heirs, and equitable treatment among heirs. The "center of gravity" for this balancing task is the valuation of the assets related to the estate plans and gifts. A thorough understanding of these concurrent goals, coupled with valuation expertise, is essential to successful and continued planning.
The professionals at Enterprise Value Advisors (EVA) have rich experience in handling the valuation requirements related to estate planning and gifts. We know how important these plans are and stand ready to assist you and your plan advisors in executing effective strategies.
Valuing goodwill and other intangible assets is a complex and challenging task. Nevertheless, due to the pervasiveness of intangible assets and acquired assets, firms potentially face adjustments to financial statements annually because of impairment and amortization. Enterprise Value Advisors (EVA) professionals can help companies with these difficult valuation issues by providing objective, expert, and well-documented valuations that can meet regulatory and tax standards and expectations.
Determining a reasonable and credible value for stock options, compensation options, and other derivative securities is central to managing the tax obligations of the firm and the recipient, while at the same time providing fair and equitable compensation. This process requires two steps: 1) determining the value of the firm and the equity of the firm and 2) determining the value of options or other derivative compensation schemes. EVA can help you value options on private firm equity while paying strict attention to FAS 123R and section 409A issues.
A particular challenge related to ESOP valuations is the number of stakeholders interested in the valuation outcome. In addition to having to stand up to the scrutiny of the courts (all valuations should meet this standard), business owners, employees, ESOP trustees and ESOP attorneys all have a vested interest in a thorough, objective, and well documented valuation.
Enterprise Value Advisors (EVA) prides itself in providing such valuation reports. We are familiar with, and understand, related academic research and court precedents. We also ensure that our analysis reflects the financial, regulatory (ERISA), and tax aspects of ESOP valuations and transactions. We also analyze the implications of repurchase obligations related to strategic planning for the company and the ESOP.
A firm or entrepreneurial venture can experience four conditions of distress: failure (not meeting risk-adjusted returns expectations or other operating standards), insolvency (inability to meet current obligations or liquidity issues), default (technical or legal), and bankruptcy (reorganization and liquidation). When these conditions or states arise, expected future cash flows and related uncertainty change dramatically, as can claims on the firms resources and assets.
Understanding the optionality of a particular claim is as important as choosing the correct valuation methodologies for distressed claims. The professionals at EVA understand the valuation dynamics of distressed claims and are ready to help you determine appropriate and credible valuations for those claims.
Determining how and when to allocate one's resources can be a daunting task. Whether it is starting a business from scratch or developing a strategy for the next phase of your enterprise's development, EVA can help you quantify those decisions.
We are experienced in modeling business growth to assist decision makers in identifying the opportunities that will create value for their firms. Whether the growth is organic or comes through acquisitions, our detailed modeling processes, which include discounted cash flow (DCF) models, Adjusted Present Value (APV) models, and real options analysis, will facilitate the strategic decision maker's planning process and increase their confidence when choosing among investment options.
Widely used discounted cash flow (DCF) models tend to do a poor job at valuing options-rich investment opportunities. The shortcoming is rooted in DCF models inability to accurately account for decision-making flexibility either by design or due to managerial discretion. That is, once an investor in engaged in an investment, valuable options present themselves. For example, options to abandon, exit, switch, delay, defer, accelerate and change the scale of operations are all important and beneficial decisions once an investment is underway. However, that actual value of these options cannot be accurately captured by DCF valuation approaches. Therefore, DCF approaches can and should be augmented by options valuation methods such as lattice models and Black-Scholes-type option pricing models.
The valuation experts at EVA can assist you in valuing your investment opportunities, including valuing the real options components of those opportunities. We'll help you identify and value the options imbedded in your investment opportunity to give you a clearer picture regarding the investment you are considering.
EVA will assist in identifying your client's key issues and will develop a substantiated, defensible solution. Services include assisting with pre-trail preparation, the estimation of economic damages, scrutinization of opposing expert's reports, and expert witness testimony.