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Tel: 0151 348 8400| Fax: 0151 348 8401 | Email: Mail@moco.co.uk

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Chartered AccountantsChartered Accountants

Company Valuations

There are a number of ways of valuing companies depending on individual circumstances and the future income stream which may arise from the company concerned.

Companies are chiefly valued either on an assets basis or on an earnings basis. If an assets sale is to take place then up to date valuations are required for property and other assets of value together with an accurate balance sheet as to the liabilities of the company and the recoverability of its debtors. It always pays to groom a balance sheet prior to sale such that any inconsistencies cannot be challenged by potential purchasers.

On an earnings basis the valuation is completed on the basis of profits that the company can generate or is foreseen to generate on a recurring basis. Stockmarket companies are frequently valued on their price earnings ratio and this is discounted in connection with smaller companies in similar trades to reflect the lack of public information which may exist and future prospects.

The taxation implications of any sale always need to be considered both in terms of corporation tax within the company and in terms of the personal tax liabilities of the shareholders.

Invariably when a company is sold there are warranties to be given in relation to the companies affairs and Morris & Co together with your legal advisers can ensure the whole sale process runs smoothly.

If you wish to have a fixed fee consultancy in relation to your company sale please email Edward Greeves

Business Finance

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