Differences between Debt and Equity Debt and Equity are two ways a company can get the money it needs. Imagine a company as a person who needs money to buy something important like better equipment for daily operations. The company can either borrow the money (Debt)...
In the captivating realm of business valuation, where fortunes hang in the balance, one rule reigns supreme: Revenue Ruling 59-60. But beyond the dry legalese lies a world of strategic insight and industry analysis that holds the power to unlock the secrets of...
There are many reasons for a client to need to determine the value of a company. Revenue Ruling 59-60 is the impetus for all business valuations (appraisals). When preparing a forecast, the future capital expenditures (typically equipment needed for growth) and...
Thursday, March 15 at 3:00pm CST J. Richard Claywell, CPA, is a panelist for this upcoming webinar, which explores the ins and outs of financial language and how you can navigate the seeming labyrinth of a language that can sound foreign and in some ways...
It’s common for businesses, in Houston as well as other locations, with more than one owner to need a buy-sell agreement to handle voluntary and involuntary ownership transfers. It’s also important to update the agreement regularly to ensure it’s still valid and...
A company’s value equals the difference between its combined assets and liabilities, so the cost approach has intuitive appeal. Although a cost approach analysis is laid out similar to a balance sheet, a document that most business owners are familiar with, it...
Business valuation pitfalls Although price-to-earnings multiples may be shared by word of mouth in certain industries by business owners and business brokers may share, valuations based solely on these oversimplified rules of thumb won’t pass muster in court. And...
Ready, set, sell A company that is well positioned for future growth is one that investors want to buy. If you’re looking to sell, it’s important to make your business more attractive to potential buyers. Here are some strategies: 1. Obtain a professional valuation A...
Often, the list of documents appraisers use to value a business include the last three to five years of financial statements. Historical trends may be used to help forecast future performance, but historical results are only relevant to the extent that similar results...
Deal of a lifetime How a private business is marketed can have a significant impact on the cash available for distribution to owners when it’s time to sell. For many private investors, their business interests are their primary assets, so their livelihoods often...
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