Value is relative. Some assignments call for an appraisal of the entire entity on a controlling basis. Others require the valuation of a minority interest that may lack control and “marketability.” How do these situations differ, and how do business valuation professionals account for these differences? Level of Value The ability to control a business has…
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Want to Move? Tax Implications of Converting a Home to a Rental Property
If you’re planning to move out of your current home, you face a tough question: Should you sell your home, or would it be more beneficial to convert it into an income-producing rental property? In terms of both selling prices and rental rates, the residential real estate market has cooled off in many areas. Even so,…
Benchmarking to Gauge Risk in Business Valuation
Benchmarking — or comparing a company’s financials to those of industry peers and its own historical performance — can provide insight into future cash flows and operating risks. Business valuation professionals use the following types of benchmarks to assess company-specific risk and, in turn, a subject company’s expected return. Profitability Profitability metrics evaluate how much money…