4
Date: Thursday, March 4, 2021
Time:
10:00am-11:40am PT / 1:00pm-2:40pm ET
Format: A BVR Webinar

Earn 2 CPE credits
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Featuring  (click image for bio)

Gregory R. Caruso
JD, CPA, CVA

About This Program

Focus in on valuing micro and small businesses using the income methods of business valuation. Learn to distinguish differing risk factors between large companies and micro and very small companies. Join Gregory Caruso for a deep dive into problematic areas of actual small-business valuation cases to review theory and tie it into the actual application of methods using best practices and professional judgment. Audience questions and succinct opinions welcomed in this hands-on event.

Agenda

    • Intro
      • Why micro and small businesses are inherently more risky than larger businesses
      • Issues with very small business and the Income Methods
        • Who is an investor?
        • Gordon Growth, Dividend Discount Model (DDM) issues
    • Cash Flow Considerations
      • EBITDA and Owner Market Compensation Issues
      • Tax Affecting
        • Issues
        • Suggested Solution
      • When using Capitalization of Earnings (and sometimes terminal value)
        • Adjustments for Working Capital, Debt, Cap X
      • Review of projections and forecasts for use in Discounted Cash Flow Method
        • Balance Sheet Accounts?
    • Calculating a Discount and Capitalization Rate
      • Buildup Method or BUM
      • Industry Premium
      • Size Premium
      • Company Specific Premium
      • Growth Rate (Capitalization Rate and Terminal Value)
    • Terminal Value
      • Gordon Growth
      • Exit Multiple Approach
    • Completing the Estimate of Value
      • Next Period Cash Flow
      • Excess Assets / Not enough assets
    • Other Issues
      • Mid-Year Capitalization Rate
      • Weighted Average Cost of Capital
      • Rule of Thumb – Finance Method
      • Rule of Thumb – Discounted Cash Flow Estimates on unsupported cash flows

Learning Objectives

    • Distinguish differing risk factors between large companies and micro and very small companies
    • Collection of qualitative data, which I refer to as “soft data,” such as internal soft data (processes, management, etc.) and external soft data (economy, industry, etc.) and then the application of findings to valuation cash flows and risk adjustments
    • Develop a discount and capitalization rate using the buildup method (BUM) for the income method as it pertains to micro and small businesses. Particular emphasis on industry risk and specific company risk and growth rate
    • Review a projection or forecast to determine suitability as a cash flow for the discounted cash flow method
    • Describe common missed cash-flow issues in the capitalization of earnings and/or terminal value year
    • Explain integrating the balance sheet into micro- and small-business valuations. Considerations include estimating working capital and excess current assets, included and excluded assets and the effect on value found, and going-concern issues in capital-intensive industries

Single Connection Policy

Admission to this event authorizes one computer and phone connection for one location. These connections may be transferred users and/or locations. Multiple concurrent connections for a single admission registration are not allowed.

Multi-User CPE Policy

Admission to this program includes one CPE certificate for one individual. Any additional listeners requesting CPE must pay a processing fee assessed at the completion of the online CE survey for this course.

CPE Processing Fees may be bypassed by entering a valid, unused CPE Authorization Code (for single event purchasers) or by logging into BVR's website (for subscribers to BVR's Training Series).

CPE Information

Prerequisites: Knowledge of Business Valuation
Program Level: Advanced
Preparation Required: None
Delivery Method: Group Internet-Based
Recommended CPE: 2 Credit Hours (Accounting Technical)

Closed Captioning:

BVR now has closed captioning on all 2019 past programs. To try out this enhancement, subscribers can login to the Desktop Learning Center, select a program, and click play video. The captions will start to play automatically, and can be disabled from the player per your preference.


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