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Monday, July 16
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Business Valuation Services

There is a growing need for business valuation services.  GAR Associates can now provide valuations for business owners, investors, lenders, attorneys, municipalities, and others needing valuation expertise.

FASB 141:  When any business makes an asset purchase of another business, Financial Accounting Standards Board Statement 141 requires the financial statements to reflect the acquisition of assets purchased based on fair value.

FASB 142:  Businesses that have goodwill assets on their balance sheets used to amortize this asset over a number of years until FASB 142 was instituted.  Now businesses which have goodwill assets must perform annual tests of the fair value of the goodwill asset.  If the asset has declined in value, an appropriate reduction in the value of the goodwill must be recorded.  This is referred to as impairment testing.

Sale of a Business or Planning for the Sale of a Business:  A good valuation will provide more than a number.  It will provide information regarding the most likely tupe of buyer.  A good valuation analyzes both the strengths and weaknesses of a business compared to competitors.  This market knowledge can be used to maximize value for a sale of the business planned years into the future.

Estate Planning / Sale of a Business Within a Family or to Existing Managers:  If a transfer is to be accomplished within a family, a planned transfer of shares (beginning sooner rather than later) can minimize potential capital gains tax liability for the seller.  It is important to obtain an independent valuation of the shares transferred in order to meet the standards of the IRS.  Where the buyer is identified early on, the gradual sale of shares minimizes risk for all parties involved, as well as often reducing taxes.

Strategic Planning:  A business considering an expansion, sale of a non-core product line, or any type of significant change should be aware of the impact that a change in the business will have to the business value.  A business valuation can also give evidence of how much of a premium the market will pay for size.  Such information is valuable when considering an acquisition strategy.

At GAR Associates, all we do is related to valuation.  Let us handle your valuation and appraisal work for both your commercial real estate as well as for your operating business.

For Additional Information, Please Contact:
Franz H. Ross, CBA  
Certified General Appraiser
(716) 691-7100 Ext. 3040