Understanding Business Valuation and Business Appraisals

Business appraisals & valuations are serious business. Because they are used for a variety of intended uses, it is important that you chose an appraiser who not only meets your needs but carries the requisite training, certifications and expert knowledge to provide a report custom tailored to your needs. George & Company provides certified opinions of value for all purposes. Whether a divorce, stockholder action, economic damages, potential sale of your company, ESOP, exit planning or general knowledge -- you should do your due diligence in reviewing the credentials of each appraiser before making an informed choice.


  • Does your appraiser have expert witness experience in the courtroom?
  • Is the appraiser current with recent court opinions and case law?
  • Have they set legal precedence with their reports?
  • Do their reports clearly and concisely indicate how the opinion of value was reached?
  • Does the appraiser have a team of analysts available to expedite the process?


When Rule of Thumb can be Rule of Dumb


Beware of business brokers offering a free “evaluation”. While even we offer a market based Rule of Thumb basic opinion of value, Rules of Thumb can be Rules of Dumb without being in possession of all the relevant factors required to opine on value. The Uniform Standards (USPAP) for business appraisers dictates a minimum of 3 valuation approaches be examined. George & Company typically will examine up to 8 appraisal metrics to insure a valuation you can bank on. More and more CPA’s are entering the business appraisal field but they lack the understanding of what the marketplace is paying. Properly trained business brokers and M&A intermediaries possess the “in the trenches” knowledge of actual multiples being paid.  


Business Valuation and Appraisal Standards

USPAP is an abbreviation for the Uniform Standards of Professional Appraisal Practice. The Appraisal Institute of Washington, DC along with most all professional appraisal organizations have set forth these standards as what MUST be done when performing an appraisal of a business entity. Beware of “business appraisers” who claim to do “evaluations” that do not adhere to the standards promulgated by USPAP. The staff at George & Company regularly attends continuing education on the proper standards and procedures for business valuations and appraisals.

Business Appraisals for a Business Sale

Selling a business is far different from selling a house or other tangible asset where there exists comparable sales information sufficient to support a value. Unlike real estate, it is not unusual for 50% or more of an operating business’s value to be based on intangible assets such as trade name and goodwill, intellectual property, licenses, location, etc. Business valuation is a complex process. Part art and part science, it relies on elaborate business metrics and intangible factors that only come with experience. At George & Company we have that experience – and we can put it to work for you.