The price, expressed in terms of Cash Equivalents, at which property would change hands between a hypothetical willing and able buyer and a hypothetical willing and able seller, acting at arm’s length in an open and unrestricted market, when neither is under compulsion to buy or sell and when both… Read More »Fair Market Value
An opinion as to whether or not the consideration in a transaction is fair from a financial point of view. This opinion is usually prepared by an accountant or other financial professional.
In a family succession or retirement transition, ownership transfers from current owners to other family members. Facilitators are particularly sensitive to estate planning issues, family business dynamics and the need for discretion and trust to makes these transaction seamless and successful.
An accounting method of valuing inventory, based on the assumption that the “first” unit of an item of inventory purchased (the oldest) is the first unit sold out of inventory. In pricing, the inventory under this valuation method the ending inventory is the aggregate of the cost of the newest,… Read More »FIFO (First In First Out)
a) The largest group of buyers in the financial category are private equity (PE) firms. Twenty years ago, this was a very small segment of the buyer category. Now there are an estimated 4,000 PE firms throughout North America. These PE firms have over $1.5 trillion of “dry powder” (financial… Read More »Financial Buyer
The degree of uncertainty of realizing expected future returns of the business resulting from financial leverage. See Business Risk.
An amount paid to another party for locating and referring a Client or customer. Also known as a “referral fee.”
Annual period of time to which a business adheres for financial reporting.
Liquidation value, at which the asset or assets are sold as quickly as possible, such as at an auction. Because of insufficient time to sell on the open market, Liquidation Value is typically lower than Fair Market Value.
The value of a business enterprise that is expected to continue to operate into the future. The intangible elements of Going Concern Value result from factors such as having a trained work force, an operational plant, and the necessary licenses, systems and procedures in place.