As a business owner, it’s highly likely that you’re consistently focused on operations and growth; your drivers of strategic success are based on maintaining your market position and leveraging available opportunities for expansion. This is a common, effective, and logical. However, do you currently know what the true value of your business is? Staying aware of this important information may help you in your operational decisions in the near future, and for long-term, blue sky planning.
Having an up-to-date business valuation allows you to better understand your assets, your resale value, and can even provide you with better leverage or negotiating power when entering into any sort of mergers and acquisition talks. The Australian Tax Office (ATO) also requires accurate business valuation information for a number of discrete tax situations, including:
- changes in capital structure
- changes of ownership
- capital gains tax rollovers
- company divestments
- company acquisitions
- formation of, entry to, or exit from a consolidated group
So, it’s clear that business valuation is important, but many business owners don’t know where to start. A valuation can be based on multiple methods, including market-based, income-based, asset-based, or costs-based. If that wasn’t enough, there’s further complexity; once an appropriate method is chosen, you need to then look at factors like comparable transactions and trading, capitalisation of earnings, discounted cash-flow, and net asset calculation.
If you’re thinking about selling your business, seeking further investment for growth, or entering into a merger or acquisition, make sure your business is appropriately and accurately valued. If you’re dealing with personal issues such as a divorce, the death or disability of a business partner, or even just starting to think about retirement and succession planning, a valuation is also an important piece of information to inform your decisions.
Having a financial specialist facilitate your valuation is recommended to ensure your business’s specific individualities are accounted for correctly. At Halkin Business Partners, we understand that each of our clients is unique, with their own financial circumstances, individual needs and goals. Understanding your business in this way allows us to tailor appropriate wealth strategies and services.
How can Halkin Business Partners help?
Talk to our financial specialists to see how we can assist in valuing your business, and grow your wealth. Our expertise in managing wealth creation and transfer, retirement, debt and risk management/mitigation services allows us to optimise your circumstances for financial success.