Questions about value arise frequently, when capital, ownership rights, tax consequences, or legal interests are at stake. Engaging a Chartered Business Valuator (CBV) at the right time supports both the assessment and decisions arising from it, as well as the people who rely on them.
Signs it’s time to engage a CBV
Consider a CBV when:
- You’re buying, selling, or merging a business
- An owner is joining, leaving, or being bought out
- You’re planning for succession or an estate
- A dispute involves the value of a business or its shares
- A tax event calls for a supportable value
- Your financial statements need acquired assets or goodwill valued
- You’re establishing value for stock options, equity compensation, employee ownership plans, or management buyouts
- You need a supportable value for situations involving the interests of shareholders
- You’re raising capital or financing against business value
- You simply want to know what your business is worth
Before you go to market, or make or accept an offer, you need a defensible valuation. A CBV establishes a supportable price range, identifies the drivers a buyer will pay for, and tests the assumptions behind projected returns so your negotiating position is supported by evidence. Engage one early enough to shape the deal, not just to confirm it.
When an owner joins, exits, or is bought out of a business, an impartial value is necessary for a fair transaction. A CBV supports buy-sell agreements, shareholder buyouts, and the price-setting mechanisms in your governing documents, while providing an objective number that keeps a routine change from becoming a dispute.
Passing a business to the next generation or preparing an estate depends on knowing what it’s worth today. A CBV provides the valuation foundation for a successful transition of ownership, helping ensure that value is understood, interests are protected, and succession decisions are made on a sound financial basis.
When value is contested, an independent expert is essential. A CBV quantifies business or share value and economic damages in shareholder and corporate disputes, commercial damages and lost profits, matrimonial law, expropriation and business loss claims, tax disputes, securities disputes, financial investigations, and insolvency and restructuring disputes.
Tax events require a defendable value. A CBV supports estate freezes, corporate reorganizations, intergenerational transfers, documenting the reasoning behind the number so it withstands review.
Acquisitions and corporate year-ends often trigger valuation requirements under accounting standards. Whether that involves allocating a purchase price, testing goodwill and intangibles for impairment, or valuing stock-based compensation, a CBV delivers valuations that meet those standards and satisfy auditors.
A CBV determines the value of the business, shares or equity interests underlying compensation and ownership arrangements, helping ensure that employees, executives, owners and investors transact or receive compensation on a sound and supportable valuation basis.
A CBV provides the independent valuation analysis needed to assess fairness and protect shareholder interests in significant public-company transactions. This can include going-private transactions, related-party transactions, takeover bids, significant acquisitions or divestitures, and other transactions where shareholders may be asked to approve or accept a particular value.
Whether you’re raising capital, borrowing against business value, or simply setting strategy, knowing your business’ worth sharpens every decision. A CBV gives lenders and investors a credible basis for their confidence and gives you a clear view of where value is created and where it’s at risk.
For professionals who refer a CBV
If you advise clients, involving a CBV early strengthens your case and protects your client. Bring in a CBV while assumptions are still being developed so the analysis reflects your circumstances from the outset. Here are some common situations by profession.
Lawyers: Litigation and damages quantification, shareholder oppression, family law, as well as corporate or commercial transactions and restructurings.
Accountants: Tax planning and restructurings, valuations for financial reporting purposes, and transaction support when an independent opinion is required.
Financial Advisors and Wealth Planners: Succession planning, estate planning, and business-owner clients approaching a transition.
The common thread is simple. When a decision depends on the value of a business, a CBV provides an independent and defensible answer.