Every business is unique; there is no definitive way to immediately prescribe a certain method. There are three main valuation approaches that are used to value businesses.
They are the income approach, market approach and cost approach. It is important that the valuer considers all approaches and chooses the most appropriate one for a respective business. There are cases where multiple approaches are required to be used, to provide a fair estimation of value.
In general we require to see past and current financial statements (profit and loss + balance sheet), forecast statements, list of intangible assets, fixed assets, etc., whichever is applicable.
There is a questionnaire form that you will need to complete to provide us with detailed information of the business.
Depending on the complexity and requirements of the valuation case, the valuation fees will vary. Whilst it is common for professional and qualified service providers to charge fees starting from SGD$7,000 and go up based on the complexity, timing and risks involved with the case.
We choose to base our fees on a flat fee basis, so you have the assurance and comfort knowing of the costs before engaging our services. Our fees are tiered-base as follow:
Business revenues less than SGD$ 500,000 = SGD $3,500.0 onwards
Business revenues less than SGD$ 1.5 million = SGD $4,500.0 onwards
Business revenues less than SGD$ 5 million = SGD $5,500.0 onwards
Business revenues less than SGD$ 10 million = SGD $7,000.0 onwards
Business revenues more than SGD$ 10 million = SGD $9,500.0 onwards
Our team of professionals has over 12 years of combined professional business valuation experience. In addition to over 20 cumulative years of experience in the accounting and audit field. We are highly experienced in handling cases ranging from sole proprietor businesses to publicly listed corporations in Asia Pacific.
You can learn more about our qualifications and background here.
There are several international valuation standards in place. We practise valuation according to the International Valuation Standards Council (IVSC), which is the standard adopted by the Institute of Valuers and Appraisers, Singapore.
In most cases, it would take between 2 to 3 weeks for completion of a full valuation report, after we have received the requested information and documents.
Yes, if you have the relevant documents ready, we are able to prioritise your case within five (5) business days. An urgent fee is required.
Our process is straightforward. In most cases, we will conduct initial consultation to understand more about your business and the purpose of the valuation. After gathering specific documents and information, we will perform the valuation, which will take about 2 to 3 weeks. A comprehensive valuation report will be issued to you via email PDF and a physical hard copy mailed to you.
In more detail, a typical valuation engagement will begin with a consultation on what the intended user’s purpose for the valuation is and what the standard of value used in the report will be. After discussions on the scope of the valuation, we will prepare a service agreement that will detail the services, fees and time frame of the engagement.
Once the engagement agreement is signed by all parties, the process can begin. For smaller valuations of fees less than $4,000, this is usually paid upfront in full. For contracts of other amounts, a 50% of the fee is required upfront with the remaining balance to be paid prior to delivery of the valuation report.
A PDF version of the valuation report will be emailed to you. If you require a hardcopy version of the report, we will can mail a copy to you.
After the valuation report is sent to you, we will discuss and go through the report with you. You may have questions and topics for discussions, which we will go through and explain to you. This is part of our service, and no additional fee incurred. Even if amendments are required, it will be done at no additional cost, unless the requested amendment involves a full revaluation, which is very unlikely.
Yes, after the valuation report is sent to you, we will discuss and go through the report with you. The report will be written in a straightforward and easy-to-understand manner as much as possible, however it is expected that you may have questions and topics for discussions relating to the valuation.
We will go through the valuation and explain our answers to your questions until you understand it. This is part of our service and included in the fee you paid. Even if amendments are required, it will be done at no additional cost, unless the requested amendment involves a full revaluation, which is very unlikely.
We strive on the value we provide and positive feedback that we receive from our clients. Every case we take on is fully accounted for and extended a high level of attention and care, but at the same time we reserve the right to decline acceptance of cases for reasons such as unruly client.
Yes there is a service agreement that has to be signed and acknowledged by all parties before any work commences. The service agreement will outline and detail the scope of work involved as well as the costs involved.
Unfortunately that is beyond our scope of abilities, we are not able to offer that service. We can however sit in together with relevant parties involved and give a detailed explanation of our valuation application. We observed that this provides a high level of clarity once the parties are fully aware of how the business/share is being valued.
*In light of the COVID situation, we recommend telephone or video conferencing instead of physical meetings.
Yes, we are open for face to face meeting at our office or at your work site. Please refer to our contact page for scheduling a face to face appointment with us. Our address is also shown on the contact us page.
We are grateful for regular word of mouth referrals. Kindly let us know the lawyer/law firm/auditor/audit firm who referred us to you, and we will tailor our valuation reports to suit their requirements.
A regular valuation case would take about 2-3 weeks, and another week or so to go through detailed explanation of the valuation with you. It is recommended to start the engagement early so there is ample time for document/information gathering, actual valuation work and explanation/discussions.
It is very likely that after you send us the requested documents and information, we will have additional questions when we review and examine the requested documents and information. This process can drag, so again it is recommended to start the engagement early.
For fees lesser than SGD$4,000, typically full upfront payment is required. For other cases we can offer partial 50% payment to commence work, and balance 50% payment prior to report submission.
No there are no hidden fees. Our fees are transparent and clearly stated in the service agreement. There may be instances where further additional work (outside of the scope of work listed in the service agreement) is required by the client that will incur additional fees.
We offer payment options via Internet bank transfer, Credit/debit card payment and PayNow/PayLah.
An invoice will be issued for payment to be made with payment instructions listed on it.
Yes, it has been used in the courts of Singapore for various purposes like divorce and litigation proceedings.
Can I engage you as my own valuer if I am not satisfied with the valuation that the other party has provided?
Yes, you may engage us or other qualified professional valuers. In such a case where the other party had performed a professional business valuation, but you think there it may not be accurate, we recommend that you get a valuation done separately.
In most cases, the court will consider the different valuation reports submitted and then make his/her judgement based on the information and facts of the case presented.
The report will be prepared for the intended user who will be reading the valuation. It may not be the case that the intended user is the one who pays for the report. This will depend on the purpose and scope of the valuation.
In all cases, our valuation report will be prepared in fairness and accuracy for the intended purpose and thereby for the intended user.
Yes. After sending the report to you, we will contact you to address any questions you may have in regard to the valuation. As professionals we would explain the valuation to the extent needed so the intended user fully understands the valuation conclusion.
This will depend entirely on the situation, which we cannot speak for. In some cases, the shareholders can collectively decide to perform the valuation after internal discussions have failed, or the shareholders can also decide to base their decisions using the valuation we provide.
In all cases, we recommend that the shareholders have made a collective agreement as to how the valuation outcome will suit their requirement, as this will prevent misunderstanding and certain challenges.
Typically, our valuation report will consist of 20 pages, up to over 100 pages, depending of complexity and scope of the valuation assignment.
Although every report is different, a reference of the table of contents may include:
You may request for a physical copy of the valuation report, once the final valuation report is concluded and any pending discussion matters are resolved. There is no fee required for request of physical copy of report. Mailing (local and international) will also be provided at no cost.
We have performed valuations on a wide array of businesses and investment entities in a variety of classifications and industries.
This includes entities such as private limited companies, limited partnerships, limited liability companies, special purpose vehicles, etc .
You can refer to the list of industries that we specialise in here.
We adopt the definition recognised by local Singapore accounting standards and international valuation standards. IFRS 13 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit price).
The appropriate standard of value must be identified in every valuation assignment in order to arrive at the correct conclusion. The four standards of value generally accepted in the business valuation community are Fair value, Fair market value, Investment value and Intrinsic value.
If you are unsure, our specialists will guide you to determine the appropriate value to be used.
In brief definitions, the income approach in valuation values a company based on the amount of income the company is expected to generate in the future. It looks at the future cash flows that could be generated by the company, it analyses the risk of realizing those cash flows and then discounts those back to come up with a present value of the company. There are two income-based approaches that are primarily used when valuing a business, the Capitalization of Cash Flow Method and the Discounted Cash Flow Method.
The income approach is best used when future cash flow forecasts can be reliably estimated. Certain key input such as capital expenditure and net working capital information is required, hence the income approach is advised to be used if they can be estimated with a reasonable degree of confidence.
The market approach values a company value by considering the market prices of comparable companies that have been sold recently or are still active in the market. Apart from looking at transacted prices alone, the value of a business can also be measured via a comparison of the features of the subject of valuation with those of reasonably comparable businesses such as financial ratios (multiples) like price to earning and EV/EBITDA.
The market approach is best used when the subject company has an identifiable earnings trend and the capability to generate earnings that can warrant a higher value as compared to that of its underlying net tangible assets.
The cost approach values a business from a balance sheet perspective by simply netting the assets of the company on the balance sheet against the liabilities on the balance sheet, then adjust them accordingly.
The methods are often referred to as asset accumulation method, net asset value, adjusted net asset, adjusted book value or asset build up method. This method is used for asset-intensive businesses such as investment holdings and real estate companies.
A valuer can use any method in combination with any other method as long as they are relevant to the case. In some cases, it is also appropriate to average the findings by different methods or to weight one method over the other, this will depend on case by case.
In almost all the cases that we take on, we will consider all three approaches and utilise the most appropriate one/s for the particular case.
We specialise only in business valuation. Our team is not certified or experienced to perform valuation for property, plant, equipment and jewellery.
Yes we do. In fact we value start-ups in all life cycle stages in Asia Pacific and the US.
The methodologies used to value intangible assets are slightly different and can be complex to the standard valuation methods. Some of the methods are the Multi-Period Excess Earnings (MPEE) Method and the Relief from Royalty method.
Whilst the methodologies are one factor, the main skillset involved is determining the application of valuation inputs and using the most appropriate method.
Firstly, an intangible asset has to fulfil these criteria; it does not have physical substance, it is individual identifiable, and is non-monetary in nature. A general classification of intangible assets is:
Marketing related = Trademarks, newspaper mastheads, internet domains
Customer and supplier related = Customer list, production backlog, customer contracts and relationships
Artistic related = Books, operas, musical works, pictures, videos
Technology related = Patents, computer software, database, non-patented technology, trade secret like recipes
Contract related = Licenses, royalties, leases, franchise, rights, employment contracts
As mentioned earlier, the MPEE method is often used in valuing customer-related intangible assets. It is a financial model that estimates revenues and cash flows derived from the customer-related intangible asset and then deduct portions of the cash flow that can be attributed to supporting assets, such as a brand name or fixed assets that contributed to the generation of the cash flows, sometimes referred to as “supporting asset charges.”
The resulting cash flow, which is attributable solely to the customer-related intangible asset, is then discounted at a rate of return commensurate with the risk of the asset to calculate a present value.
In a valuation of ownership in a private company, there is the concept of discounts. If the purpose for valuation is to determine shareholder interest in a company, the valuer may need to consider discounts such as minority discounts, blockage discounts, key person discounts, shareholder level discounts and so on.