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Your Most Reputable Source for SBA Values™
(908) 888-6030

Business Appraisals

Certified Business Appraisals

This report is designed specifically for SBA lenders in need of a Certified Business Appraisal.

 


Certified Valuations

SBA SOP 50-10 5(I) Compliant

Our certified appraisers use their unique business ownership and valuation experience to produce high quality reports in a timely and efficient manner. Our firm strives to provide excellent service through collaboration and open communication with our clients.

 

This report is designed specifically for SBA Lenders that are looking for a Certified Business Appraisal for a business that requires 7(a) or 504 financing.

 

If the amount being financed (including any 7(a), 504, seller, or other financing) minus the appraised value of real estate and/or equipment is greater than $250,000 or if there is a close relationship between the buyer and seller (for example, transactions between family members or business partners), the lender must obtain an independent business appraisal from a qualified source.” – SBA Standard Operating Procedure 50 10 5(i)

Valuation Methods

We use all three Valuation Methods in our Summary Appraisals

Income Approach

 

Consists of the Direct Capitalization of Earnings Method, used when earnings are projected to remain at a constant growth rate, or the Discounted Cash Flow Method, used when earnings are projected to fluctuate before stabilizing. The appraiser uses his judgment based on historical financials, among other attributes.

Market Approach

 

Consists of the Direct Data Market Method which derives multiples as a factor of sales and earnings streams from historical transactions of similar businesses. The valuation considers historical and current financial performance and assumes that the subject business will be sold on a debt-free basis.

Asset Approach

 

Also commonly known as the “cost approach” or the “replacement-cost approach.” Each asset of the business is valued separately (typically excludes intangibles) and the total of the liabilities is subtracted to derive the total value of the enterprise.

Report Details

Report Structure


 

SBA Guidelines

SBA Standard Operating Procedures


All Reports Must:
1. Be requested and engaged by the lender
2. Be prepared for the lender
3. Identify whether the transaction is an asset or stock purchase
4. Explicitly state what is included in the sale (including any assumed debt)
5. Include a conclusion of value
6. Include qualifications of the individual performing the valuation
7. Include a signature with certification page

 

Other Requirements:
1. The lender may not use an appraisal which is prepared for the applicant or seller
2. The cost of the appraisal may be passed on to the Small Business Applicant

 

Further information regarding SBA business appraisal requirements can be found on pg. 160-162:
SBA SOP 50 10 5(i)

Request a Quote

Your Name (required)

Please enter the name of the Company to be appraised (required)

Please enter your email address (required)

What industry does the Company fall under? (required)

Purpose of Appraisal (required)
 Bank Financing Determine Business Value (Non-Bank Financing) Other

What are the Company's (approximate) average annual revenues for the past two years? (required)

Is the valuation for a single entity operating from one location, or multiple entities/locations? (required)

Write More Information Here

Input this code: captcha

Certified Valuations

SBA SOP 50-10 5(I) Compliant

Our certified appraisers use their unique business ownership and valuation experience to produce high quality reports in a timely and efficient manner. Our firm strives to provide excellent service through collaboration and open communication with our clients.

 

This report is designed specifically for SBA Lenders that are looking for a Certified Business Appraisal for a business that requires 7(a) or 504 financing.

 

If the amount being financed (including any 7(a), 504, seller, or other financing) minus the appraised value of real estate and/or equipment is greater than $250,000 or if there is a close relationship between the buyer and seller (for example, transactions between family members or business partners), the lender must obtain an independent business appraisal from a qualified source.” – SBA Standard Operating Procedure 50 10 5(i)

Valuation Methods

We use all three Valuation Methods in our Summary Appraisals

Income Approach

 

Consists of the Direct Capitalization of Earnings Method, used when earnings are projected to remain at a constant growth rate, or the Discounted Cash Flow Method, used when earnings are projected to fluctuate before stabilizing. The appraiser uses his judgment based on historical financials, among other attributes.

Market Approach

 

Consists of the Direct Data Market Method which derives multiples as a factor of sales and earnings streams from historical transactions of similar businesses. The valuation considers historical and current financial performance and assumes that the subject business will be sold on a debt-free basis.

Asset Approach

 

Also commonly known as the “cost approach” or the “replacement-cost approach.” Each asset of the business is valued separately (typically excludes intangibles) and the total of the liabilities is subtracted to derive the total value of the enterprise.

Report Details

Report Structure


 

SBA Guidelines

SBA Standard Operating Procedures


All Reports Must:
1. Be requested and engaged by the lender
2. Be prepared for the lender
3. Identify whether the transaction is an asset or stock purchase
4. Explicitly state what is included in the sale (including any assumed debt)
5. Include a conclusion of value
6. Include qualifications of the individual performing the valuation
7. Include a signature with certification page

 

Other Requirements:
1. The lender may not use an appraisal which is prepared for the applicant or seller
2. The cost of the appraisal may be passed on to the Small Business Applicant

 

Further information regarding SBA business appraisal requirements can be found on pg. 160-162:
SBA SOP 50 10 5(i)

Request a Quote

Your Name (required)

Please enter the name of the Company to be appraised (required)

Please enter your email address (required)

What industry does the Company fall under? (required)

Purpose of Appraisal (required)
 Bank Financing Determine Business Value (Non-Bank Financing) Other

What are the Company's (approximate) average annual revenues for the past two years? (required)

Is the valuation for a single entity operating from one location, or multiple entities/locations? (required)

Write More Information Here

Input this code: captcha

Our Process

 

Engage

  • Discuss with client
  • Agree on terms
  • Retain
  • Sign Agreement

Prepare

  • Gather Information
  • Initial Interviews
  • Discuss with involved
    parties (if required)
  • Conduct industry and
    economic research

Analyze

  • Analyze financial data and
    other information
  • Identify relevant methods
    of valuation
  • Conduct valuation with
    analysis
  • Analyze non-operating
    excess assets

Finalize

  • Generate report
  • Finalize Invoice
  • Deliver to client

Frequently Asked Questions

What is your typical turnaround time?

Our typical turnaround time is 7-9 business days from engagement. This can vary based on the complexity of the deal, and will be clearly conveyed prior to engagement.

Do you offer rush options?

Yes, we offer 5 and 7 day rush options for an additional cost. Availability is based on our queue at the time of request. Please contact us for more information.

What documents do you require in order to engage a report?

We will need the following:

 

  • 3 years Federal Tax Returns
  • Most recent interim Income Statement and Balance Sheet
  • Purchase agreement or letter of intent
  • Completed copy of our business valuation questionnaire
  • Credit Write-Up (if available)

 

After receiving the required documentation we will provide an engagement letter.

 

Upload documents by clicking here.

 

If you would like to request a business valuation questionnaire, please visit our questionnaire request page.

Do you provide sanity tests or rules of thumb?

Yes, we are able to conduct sanity tests on a case by case basis. Please contact us for more information.

Accreditation

The firm was founded by Neal Patel, who currently holds the prestigious Certified Business Appraiser (CBA) designation from the Institute of Business Appraisers (IBA) (only 1 of 6 CBAs in New Jersey, and 1 of 292 globally.) Accreditation as a CBA is available to those members of the IBA who are able to demonstrate that they have attained a high level of professional competence and conduct. Neal is also serving a 2 year term as the Co-Chair of the Board of Governors at the Institute of Business Appraisers.

 

Neal Patel, Kevin Zaballero and Robert Vafiadou have all earned the Certified Valuation Analyst (CVA) designation from the National Association of Certified Valuators and Analysts (NACVA).

 

More specific educational and experience requirements for all SBA SOP approved designations are included in the table below:

 

 

  • Accreditation OrganizationAccreditation Organization
  • EducationEducation
  • ExperienceExperience
  • Qualifying ExamQualifying Exam
  • Pass/Fail RatioPass/Fail Ratio
  • Report Review RequirementReport Review Requirement
  • Continuing Professional EducationContinuing Professional Education
  • Professional StandardsProfessional Standards
  • CBA

  • Accreditation OrganizationInstitute of Business Appraisers
  • EducationCollege/Equivalent
  • ExperienceMinimum of two assignments - reports must be submitted & approved
  • Qualifying ExamProctored, Closed Book
  • Pass/Fail Ratio46%
  • Report Review RequirementYes, 2 Reports rigorously reviewed by leading Business Appraisers
  • Continuing Professional EducationYes, 24 credits every two years or equivalent
  • Professional Standards
  • CVA

  • Accreditation OrganizationNational Association of Certified Valuation Analysts
  • EducationCollege/Equivalent
  • Experience2 Years
  • Qualifying ExamProctored, Closed Book, Exam includes a written portion
  • Pass/Fail Ratio70-75%
  • Report Review Requirement1 case study
  • Continuing Professional EducationYes, 36 credits every three years
  • Professional Standards
  • ASA

  • Accreditation OrganizationAmerican Society of Appraisers
  • EducationCollege/Equivalent
  • Experience5 Years
  • Qualifying ExamProctored, Closed Book Must pass an Ethics Exam. USPAP exam must be passed every 5 years
  • Pass/Fail Ratio64%
  • Report Review RequirementYes, two reports rigorously reviewed by leading Business Appraisers
  • Continuing Professional EducationYes, 40 Credits every five years
  • Professional Standards
  • ABV

  • Accreditation OrganizationAmerican Institute of Certified Public Accountants
  • EducationCollege/Equivalent
  • ExperienceInvolved in 10 Business Valuations
  • Qualifying ExamProctored, Closed Book
  • Pass/Fail Ratio71-72%
  • Report Review RequirementNone
  • Continuing Professional Education60 Credits and involvement in 5 reports every 3 years
  • Professional Standards

 

 

For a more detailed comparison of Credentials, please click the link below:

Credential Comparison Chart 2016

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