The beginning of the year. A time of new resolutions.
In this time of new resolutions, the resolution to perfectly carry out the comparative (market) approach in the process of business valuation fits perfectly. Readers of my note, a little distant from the fascinating issue of business valuation, I inform you that we have three approaches to business valuation:
High inflation in Poland and around the world affects many areas of economic life. Such examples may be the rising costs of debt of individual governments - a function of the higher yield on government bonds required by investors, or declines on stock markets reflecting the increasing cost of capital resulting from increased macroeconomic risk.
The two most common price setting mechanisms in share sales transactions are locked box and completion accounts . Both approaches address the main issue in business sale transactions in a different way - the possibility of adjusting the transaction price due to the time difference between the date of the last financial data of the sold company available to the buyer and the date of the relevant contract (the so-called closing date ). It is common sense to assume that the latest financial data of the subject of the sales transaction are subject to examination by the buyer and then become the basis for negotiations and setting the price on the date of the preliminary contract (so-called signing date ).
Of course, EBIT . Next, EBITA . Simple and obvious.
But we also have many supporters of EBITDA . But why? The topic is a bit complex - we have the illusory power of EBITDA, the disadvantages of EBIT and a new quality, i.e. EBITA...
I have already written once about the reliability of commonly used P/E and P/BV multipliers... but the questions and comments sent to us encourage us to address the issue again...
With the tax changes introduced by the Polish government from the beginning of 2021, the attractiveness of a limited partnership has decreased. This naturally leads to more transactions involving limited partnerships and creates a business need to conduct valuations of these entities.
It will still be beautiful, it will still be normal... And there are already the first signs.
Duff & Phelps has lowered its recommended Equity Risk Premium for the U.S. market from 6.0% to 5.5% for estimating the cost of capital as of December 9, 2020. The market risk premium is one of the most important parameters necessary to estimate the cost of capital in the Capital Asset Pricing Model (CAPM), used in the processes of valuation of companies and companies.
Subsidies... a timely topic due to the EU subsidies that entrepreneurs have been obtaining for a long time, as well as the current time of the COVIN-19 epidemic, which gives the opportunity to apply, among others, for exemption from the payment of Social Insurance Institution contributions and funding under the Polish Development Fund shield.
The following note discusses the accounting aspects of subsidies. The second note, I warn you, there will be a second part, will get to the point - it will be about subsidies in the context of enterprise valuation.
The global COVID-19 pandemic actually covers more and more areas of social and economic life. It is obvious that it also affects the process of valuing enterprises and companies. Let's analyze the main valuation hot areas during the uncertain coronavirus period.
We are all familiar with the company valuation model using the discounted cash flow (DCF) method. This method is based on summing the current values of cash flows from the forecast period and adding the discounted value from the Gordon Growth Model (GGM) based on the cash flow from the last year of the forecast.
What does a crocodile have to do with valuing enterprises and companies using the DCF method (discounted cash flow) and estimating the residual value in this method? I hasten to report that the crocodile is the very essence of value valuation using this method. Plus, its element, next to water, is residual value...
The Commercial Companies Code (Act of September 15, 2000; Journal of Laws 2000, No. 94, item 1037 - hereinafter referred to as "CCC") refers in many places to the issue of valuation of companies and assets - a very important issue from the point of view of economic transactions. Moreover, the Commercial Companies Code introduces, directly and indirectly, Avalue standards, which, as should be reasonably assumed, are the basis for valuation. Let's analyze this wealth of diversity... What terms and value standards appear in the Code of Commercial Companies? Let's list the terms used in the Commercial Companies Code below:
Value Solutions
Cann Advisory sp. z o.o.
Plac Jana Henryka Dąbrowskiego 1
00-057 Warsaw
tel. +48 22 616 20 32
mob. +48 606 234 150
e-mail info@cann.pl
Cann Advisory sp. z o.o.
Plac Jana Henryka Dąbrowskiego 1
00-057 Warsaw
phone +48 22 616 20 32
mob. +48 606 234 150
info@cann.pl
Our website uses "cookies" for statistical, advertising and functional purposes. By collecting cookies, we can customize the site to Your needs.
You can accept cookies or have the option of disabling them in the browser, so that no information will be collected. More details are included in „Polityka prywatności”