Business Valuation Course Outline

Program Outcomes

After completing this course, attendees will be able to:

  • Identify the fundamental steps to valuing a business, from beginning to end
  • Identify an appropriate valuation method within the valuation approaches based on the specific purpose and standard of value for a given valuation assignment
  • Determine the most appropriate financial analysis of a subject company as it relates to a specific valuation engagement
  • Identify the foundations of the business valuation analysis process as well as the value drivers that support a subject company’s value
  • Recognize the differences in the various standards of value for businesses and the nuances of their application in a business valuation engagement

Program Outline

Days 1 and 2: Business Valuations—Fundamentals, Techniques, and Theory (FT&T)

  • Structure the elements of a valuation engagement from financial and operational analysis through to a conclusion of value
  • Analyze financial and operational information for a business entity as it relates to a valuation engagement
  • Differentiate the methods found in the three approaches to valuation—Asset, Income, and Market, and determine when it is appropriate to use each approach
  • Identify methods and data sources for developing discount and capitalization rates
  • Determine appropriate adjustments (i.e., premiums and discounts) to be applied to an indicated value
  • Employ professional standards for the development and reporting of a valuation/calculation engagement

Day 3: Business Valuations—Applications and Calculations of the Income and Asset Approache

  • Determine a value using the Adjusted Net Asset Method under the Asset Approach
  • Determine when it is appropriate to use a Capitalization of Single-Period Earnings Method vs. Discounted Future Earnings Method under the Income Approach
  • Identify appropriate normalization adjustments to apply to a business entity’s balance sheet and income statement
  • Calculate a normalized benefit stream under the Income Approach

Day 4: The Market Approach—Exploring the Pricing Component

  • Recognize the theory behind the Market Approach including its rationale, standards of value, main methods, and governing principles.
  • Identify the key challenges in the application of the Market Approach and explain the current best practices used by valuation practitioners in overcoming and/or minimizing these challenges.
  • Determine when the use of the Completed Transaction Method and/or Guideline Public Company Method is appropriate under the Market Approach.
  • Identify the steps in selecting guideline companies and completed transactions relevant to the Subject Company.
  • Describe the most commonly used valuation multiples, their corresponding drivers, and applicability depending on what level of value is being sought.
  • Explain the process of adjusting valuation multiples to account for differences in size, growth, and business risk.

Day 5 (morning): Valuation in Action—Case Studies: Applying the Principles and Techniques

  • Identify the key challenges, requirements, and nuances in conducting a valuation analysis for various special purposes.
  • Identify the steps in the analysis and valuation of a company in a typical valuation engagement.
  • Apply the three main valuation approaches—Assets, Income, and Market in a live case.
  • Describe the key sections of a valuation report and how to connect the narrative to the quantitative analysis.
  • Explain the process of reconciling the different indications of value in the valuation analysis.

Day 5 (afternoon): Exam Preparation—CVA Proctored Exam and Peer Reviewed Business Valuation Report (Case Study)

Day 6: CVA Proctored Exam

  • The five-hour proctored exam is given at the Mercer University Atlanta classroom location on the Saturday morning following the training.