Microsoft Word peachtree case study
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| 3.2.1 Nature of the Industry ................................................................................................................ 46 3.2.2 Industry Outlook ......................................................................................................................... 47 3.3 Impact on Valuation Subject ............................................................................................................. 51 Page 11 of 141 4.0 ANALYSIS OF SUBJECT COMPANY ......................................................................................................... 53 4.1 Brief History ...................................................................................................................................... 53 4.2 Prior Transactions ............................................................................................................................. 54 4.3 Company Operations ........................................................................................................................ 54 4.4 Products and Services ....................................................................................................................... 56 4.5 Customer Base .................................................................................................................................. 57 4.6 Competition ...................................................................................................................................... 58 4.7 Company Outlook ............................................................................................................................. 61 4.8 Company Financial Review ............................................................................................................... 61 4.8.1 Financial Statement Normalization ........................................................................................... 63 4.8.2 Detailed Financial Analysis of the Company .............................................................................. 73 4.8.3 Impact of Financial Analysis on Appraisal .................................................................................. 81 4.9 Financial Forecast .............................................................................................................................. 81 5.0 VALUATION ANALYSIS AND CALCULATIONS ......................................................................................... 85 5.1 Application of the Market Approach ................................................................................................ 85 5.1.1 Private Company Transaction Method ...................................................................................... 85 5.1.2 Guideline Public Company Method ............................................................................................ 95 5.2 Application of the Income Approach ................................................................................................ 95 5.2.1 Economic Income Flow Development ........................................................................................ 96 5.2.2 Discount and Capitalization Rates ............................................................................................. 98 5.2.3 Calculation of Estimated Operating Value ............................................................................... 104 5.3 Application of the Asset Based Approach ....................................................................................... 105 5.3.1 Adjusted Book Value Method ................................................................................................... 107 5.3.2 Liquidation Value Method ........................................................................................................ 112 5.4 Summary of Estimated Operating Values ....................................................................................... 113 5.5 Valuation Adjustments .................................................................................................................... 113 5.5.1 Control Premium – Subject Interest ......................................................................................... 114 5.5.2 Discount for Lack of Control – Subject Interest ........................................................................ 114 5.5.3 Discount for Lack of Marketability ‐ Subject Interest ............................................................... 116 5.5.4 Non‐Operating Assets and Liabilities ‐ Subject Interest ........................................................... 121 5.6 Calculated Values after Valuation Adjustments ............................................................................. 121 5.7 Reconciliation of Values .................................................................................................................. 122 Page 12 of 141 5.7.1 Value Conclusion ...................................................................................................................... 124 6.0 FINAL COMMENTS .............................................................................................................................. 125 6.1 Statement of Assumptions and Limiting Conditions ....................................................................... 125 7.0 PROFESSIONAL QUALIFICATIONS OF APPRAISER ............................................................................... 127 Appendix A Sources of Information ......................................................................................................... 129 Appendix B International Glossary of Business Valuation Terms ............................................................ 130 Download 0.84 Mb. 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