Valuation

Business valuation

Today's global environment has elevated the importance and complexity of business valuations. Whether you are considering a potential transaction or restructuring; you are involved in a negotiation; or you need an appraisal for financial reporting or tax purposes, we are ready to help you. We recognise that a valuation is not a simple numbers exercise. Instead, we combine our technical skills and practical experience to provide advice that aligns with your business goals.

Our approach to business valuation is based on national and international standards. These standards require us to act objectively and independently in accordance with general accepted valuation models and techniques. We base our work on our thorough knowledge of the business we value to corroborate valuation results. This is key to selecting the most relevant approach, for it to stand up strongly if challenged and scrutinised by counterparts.

Scope and content of a valuation report depend on the purpose of the assignment and may range from indicative valuations to full scope independent expert reports:

 
  • indicative valuations in alignment with your needs to identify key issues and potential value triggers and possible valuation scenarios, which are summarised in a short form report;
  • full-scope independent valuation reports within generally accepted frameworks, where we act according to Valuation Standards of the Republic of Kazakhstan, International Valuation Standards and RICS standards,
A valuation may be needed:
 
  • for corporate governance or regulatory compliance;
  • to support critical strategic decision making such as planning an acquisition or disposal;
  • to assist with resolving disputes between shareholders or business partners;
  • as a fundamental part of operational management in monitoring portfolio performance or maximising shareholder value;
  • for managerial decision making.
All businesses are unique and face different factors. The value of any company or asset is intrinsically linked to the future income that it will generate. These future income streams are normally uncertain.

Valuation requires an in depth understanding of the asset being valued, the market in which it operates, the company that owns it and its competitive strengths and weaknesses. It requires analysis of financial and non-financial information and assess other factors such as the legal and regulatory environment.

Valuation requires the right combination of commercial insight, technical expertise, experience and professional judgement. Our valuation team works closely with clients to understand their needs and to develop bespoke solutions to complex valuation issues. We focus on understanding business dynamics and the key value drivers of the sector in which it operates.

Our team has extensive experience in valuing companies and assets across a range of industries. We have extensive sector knowledge to determine the appropriate valuation methodology to provide well-informed, insightful, robust and transparent valuation opinions.


Our approach

Our approach involves a number of key steps:

 
  • financial analysis – we prepare a comprehensive review of the historical accounts of the company;
  • cash flow forecast and stress testing – we prepare a scenario “stress test” of forward-looking statements of the company;
  • sector analysis – we complete a review of market sector financial ratios of the sector in which the company operates. This involves reviewing price earnings ratios, costs of capital and other market sector metrics;
  • we prepare our valuation and present our draft report;
  • following discussion and engagement with the company board, we finalise our report.
Our methodologies

Company valuation, by its nature, has an inherent degree of uncertainty. The outcome of a company valuation process is an estimate of the value a third party might be expected to pay for an asset.

Notwithstanding this uncertainty, there are established corporate finance principles and methodologies which enable valuations to be prepared on a sound theoretical basis.
At Moore Stephens we have the corporate finance experience and expertise to apply these principles to privately owned Irish companies and arrive at a practical solution for our clients.

Value is commonly derived by applying one (or more) of the following valuation methodologies:
  • Asset based methods;
  • Capitalisation of earnings methods;
  • Discounted cash flows methods.