Business Valuation - share sale - withdrawal of a partner - gain compensation - neutral expert - consultant - intermediary - IDW S1
Courts need corporate appraisals when parties disagree as to the amount of the value of a company or its value for another issue of importance. Accepted method of business valuation is the discounted cash flow method and the CF-method (discounted cash flow method). Both methods lead to the same results with the same assumptions.
The enterprise value is calculated using the gross method from the benefits the company can provide in the future primarily due to its existing in the valuation point material substance, its innovation, its product design and position in the market, its internal organization and its predisposing management.
The future benefit that results from the interaction of all these, the profitability of constituting factors, shows basically the surplus of income over expenditure, which is to be expected after the valuation date. Therefore, the value of a company is the present value of future income surpluses.
To determine this present value, a discount rate is used, which represents the rate of return from an investment in the company being valued adequate alternative investment. When profits which are the same in all future years, the enterprise value is the quotient of these gains and the capitalization rate.
This comparison only leads to a correct assessment if the equivalence principle is satisfied, that is when the profits of being valued Unterehmens and gains or the return of an alternative object to be detected in an equivalent manner. The equivalence conditions maturity equivalence, risk equivalence and taxation equivalence must be met.
The function of the verifier
The appraiser must determine and specify in the report the purpose for which it is acting. The evaluation purpose, the function of the expert (neutral expert, consultant and arbitrator or mediator). Depending on the function of the expert to change the assumptions on the forecast of future profits and on the appropriate level of capitalization rate.
As a neutral expert of the experts is to an objectified, independent of the individual values of the parties concerned value of the company determine (Typed future success value), which in continuation of the company with the natural concept (with all realistic expectations for the future as part of its market opportunities and risks, financial opportunities and other factors) results.
As a consultant of the appraiser is to determine a subjective decision value. This may for example be a maximum resale price or a lower price limit.
As arbitrator or mediator of the appraiser is to determine in a conflict situation, taking into account the different subjective preferences of the parties an agreement value or suggest
Our references in the field of business valuation include in particular
- Share Legal appraisal proceedings in analogous application.
- Determination of a reasonable shareholder value in the case of other changes of ownership
- Reasonable value of the company to determine the appropriate gain compensation in divorce cases
- Determining a fair enterprise value under inheritance disputes
- Determining the company's value in withdrawal of a partner of a company
- Determining the reasonable compensation of excluded shareholders in accordance with § 327a Squeeze Out -Fällen AktG analogously
We take over the functions of the
- Neutral expert
- Arbitrator and
Business Valuation at AEC Eisele Consulting Cologne