Hardcover
384 pages
January 2003
From the Publisher:
Business Valuation Body of Knowledge, Second Edition brings together the essentials of the core knowledge of business valuation as taught today by the leading professional associations. It provides both a study guide for those seeking business valuation certification (ABV, ASA, CBA, and CVA) as well as a reference guide for day-to-day use by practitioners.
Shannon Pratt, one of the foremost authorities on the subject, emphasizes the valuation of closely held businesses and interests throughout, but much of the material is also applicable to publicly traded companies. The book begins by describing the legal and professional environment in which business valuation typically takes place, presenting a glossary of terms and the mathematical notation commonly used. The core of the book presents valuation approaches and methods, followed by company, industry, and economic analysis. Business Valuation Body of Knowledge also includes an extensive case study to demonstrate valuation practices in action and discusses how valuation methods may differ for different purposes–tax matters, employee stock ownership plans (ESOPs), shareholder disputes, etc. For the practitioner seeking accreditation, the book:
- Outlines the topics generally covered in accreditation exams, providing a review of the basics
- Identifies where topics are covered in each organization’s materials and reference books
- Reviews the current rulings and professional positions on basic business valuation topics
- Provides a time-saving source to other references, with various views on basic topics
- Serves, in case of litigation, as a guide to help ensure that basic considerations have not been overlooked, and includes sources for positions on controversial issues
Praise for the First Edition
"The beauty of this work is that it points the reader to each professional organization’s writings on issues relating to business valuation methodologies and applications. I can’t think of an attorney who works with business valuation professionals who should not have this book." – Robert E. Kleeman Jr., CPA/ABV, ASA, CVA, CFE, Clifton Gunderson, LLC
"Business Valuation Body of Knowledge will quickly become one of the foremost authoritative sources on the ‘body of knowledge’ for business valuations. It is well organized and written in a style which allows it to be used as both a teaching tool and a reference manual." – R. James Alerding, CPA/ABV, ASA, CVA, Clifton Gunderson, LLC
"When you simply need the answer, Shannon has it for you. The Body is a no-nonsense repository of information!" – Stephen J. Bravo, CPA/ABV, CBA, CPF, PFS, Apogee Business Valuations, Inc.
"This book is a ‘must have’ for every business valuation library. . . . [Shannon has] done an excellent job of compiling a core body of knowledge that is common to all of the major accrediting organizations in the business valuation profession." – Thomas E. Hilton, CPA, CVA, Anders, Minkler & Diehl, LLP
"The book is great. I especially like the cost of capital chapter. . . . It’s one of the few books where there is a succinct description of the different methods to determine the cost of capital. I thoroughly enjoyed reading it and it was a great refresher for me." – Mary McCarter, ASA, CFA, Columbia Financial Advisors, Inc
About the Author
SHANNON P. PRATT, CFA, FASA, MCBA, is a founder and managing director of Willamette Management Associates, one of the oldest and largest independent valuation consulting, economic analysis, and financial advisory firms, with offices in principal cities across the United States. Over a distinguished career of more than three decades, he has performed valuation engagements for M&A, ESOPs, and numerous other purposes. He has testified in a wide variety of federal and state courts across the country and frequently participates in arbitration and mediation proceedings. Dr. Pratt is one of the most successful and respected authors in his field. He is coauthor of several industry standards, including Valuing a Business: The Analysis and Appraisal of Closely Held Companies, Valuing Small Businesses and Professional Practices, The Market Approach to Valuing Businesses, and Cost of Capital. He is also editor in chief of Shannon Pratt s Business Valuation Update, the premier monthly newsletter in the field of business valuation.
Table of Contents
- PART I. BUSINESS VALUATION ENGAGEMENT ENVIRONMENT.
- Chapter 1. Business Valuation Legal and Regulatory Environment.
- Chapter 2. Business Valuation Professional Environment.
- Chapter 3. Business Valuation Engagement.
- Chapter 4. Litigation Service Engagements.
- PART II. TERMINOLOGY AND NOTATION.
- Chapter 5. International Glossary of Business Valuation Terms.
- Chapter 6. Notation Systems Used in This Book.
- PART III. VALUATION APPROACHES AND METHODS.
- Chapter 7. Overview of Valuation Approaches and Methods.
- Chapter 8. Income Approach: Cost of Capital.
- Chapter 9. Income Approach: Discounting Method.
- Chapter 10. Income Approach: Capitalization Method.
- Chapter 11. Market Approach: Guideline Public Company Method.
- Chapter 12. Market Approach: Guideline Merger and Acquisition Method.
- Chapter 13. Prior Transactions, Offers, and Buy-Sell Agreements.
- Chapter 14. Adjusted (Net) Asset Method.
- Chapter 15 . Excess Earnings Method.
- Chapter 16. Discounts and Premiums.
- Chapter 17. Reconciliation and Value Conclusion.
- PART IV. ANALYSIS OF THE COMPANY.
- Chapter 18. Financial Statement Analysis.
- Chapter 19. Using Economic and Industry Data.
- Chapter 20. Site Visits and Interviews.
- PART V. SUPPORTING DATA: Chapter 21. Sources of Supporting Data.
- PART VI. SAMPLE CASE: Chapter 22. Sample Case: Shannon's Bull Market.
- PART VII. VALUATIONS FOR SPECIFIC PURPOSES.
- Chapter 23. Tax-Related Valuations.
- Chapter 24. Employee Stock Ownership Plans (ESOPs).
- Chapter 25. Shareholder Buyouts and Disputes.
- Chapter 26. Marital Dissolutions.
- Appendix A: Bibliography of Reference Sources.
- Appendix B: Federal Rule of Civil Procedure 26: General Provisions Governing Discovery; Duty of Disclosure.
- Self-Study CPE Examination.
