Whether you are buying or selling a business, or yearly planning for your company, a business appraisal can help you understand your business’ value and what factors impact it. One of the first things in obtaining a business valuation is finding a quality business appraiser. A business appraiser is a professional who provides an independent “opinion of value” of a business. It is both an art and a science. So, where can you find one and how can you tell if they are a quality appraiser?
Finding a Business Appraiser
Finding a business appraiser today is relatively easy. One of the best ways to find an appraiser is by asking for recommendations. Your financial professional, legal representative, or anyone you know who has recently had a valuation can be useful. By searching online, you can pull up individuals who are experts in your industry or in your geographic area. Business appraisers who speak or write for your industry may also be good options.
Evaluating a Business Appraiser
There are a few ways to evaluate a business appraiser. First, check out their website and/or LinkedIn profile. Websites can give insight into what type of individual they are, who they have worked with, and what problems they have solved. You can also seek recommendations from clients about what it was like working with them. Quality business appraisers will also have professional credentials. Peak Business Valuation, business appraiser is happy to answer any of your questions. Schedule a free consultation today!
Professional Credentials:
Be sure to consider the professional credentials and certifications. Business appraisers have wide backgrounds and different capabilities. Most business appraisers have a professional designation after their name as a result of their experience and education. However, just because they have a certain credential it may not make them a great fit for you. Credentials are often the minimum training needed to provide certain services. Here are a few of the common credentials you may see:
– Accredited Senior Appraiser (ASA): This designation is from the American Society of Appraisers (ASA). Holders must have a 4-year degree, 5 years of experience, and complete extensive coursework as well as oral and written exams.
– Accredited in Business Valuation (ABV): This designation is from the American Institute of Certified Public Accountants (AICPA). Holders must have a valid CPA, complete the ABV exam, work on 10 engagements, and meet business valuation experience and education requirements.
– Certified Business Appraiser (CBA): This designation is from the National Association of Certified Valuation Analysts (NACVA). Holders must have a 4-year college degree, pass the CBA exam, and complete the necessary coursework.
– Certified Valuation Analyst (CVA): This designation is from the National Association of Certified Valuation Analysts (NACVA). Holders must complete coursework, a written exam, and demonstrate substantial experience.
Each designation has a different level of experience to satisfy the requirements. Be sure to know the difference when selecting an appraiser. Not all individuals are equally experienced.
Selecting a Business Appraiser
The best way to select a business appraiser is to interview them and see if it is a good fit. We recommend speaking with several business appraisers. Effective ones will take time to thoroughly explain the process, learn about your business, and ask questions.
Summary
When seeking a business valuation, be sure to find a quality business appraiser who is a good fit for you and your business. Consider the individual’s work experience, industry experience, and client references. Review the website and publications that give insight into their experience. Also, review the appraiser’s credentials as it provides added support should the appraisal be taken before the court, or the IRS, or be reviewed by an auditor.
Peak Business Valuation would love to help you with a business appraisal. We work with small business owners in a variety of industries. Questions are always welcome. Please reach out by scheduling a free consultation!
