Not every financial professional is qualified to value a business — especially if a third party will rely upon the appraisal. Earning a valuation credential requires specific coursework, testing, peer review and other prerequisites. This article helps business owners and attorneys sort through the various valuation credentials by summarizing the requirements of the most common business valuation designations.
In answering the question of what a business is truly worth, an appraiser considers many aspects of its operations, from management, to products and services, to the health of its industry. He or she also looks beyond the balance sheet, seeking any hidden assets or liabilities that may affect value. An appraiser analyzes several areas, including uncollectible receivables, inventories and fixed assets, in determining the appropriate adjustments.