The valuation of a closely held business requires special financial expertise and a thorough understanding of the business and its industry. The value of a business interest can vary dramatically due to whether or not it controls the business operations, if there is an identified buyer and other important factors.

There are three traditional approaches to determining the fair market value of interests in closely held entities:  the income approach, market approach and cost or underlying asset approach. The true indication of value is the price and terms received upon a sale.

At Next Plateau, our valuation professionals can identify and apply appropriate methods for a particular business and help you understand the factors affecting value. Our reports are designed to ensure readability by clients and their advisors. We are knowledgeable of the tax issues and adjustments related to financial statements making us adept at determining and supporting the capitalization and discount rates used to calculate the value of a business. We consider factors that are often overlooked when determining value, such as the value of non-operating assets, the additional cash flow generated by reducing owner and family member salary, etc. We can also calculate discounts to value based on the purpose of the valuation and the interest in the business being valued.