Business Valuation Litigation

Business Valuation Litigation - Contextual Considerations and the Assessment of Economic Damages 

When financial markets turn downward, litigation tends to escalate. In this climate, it is increasingly important for businesses to retain experts to perform analysis that quantifies economic damages or lost profits related to a damaging event in a litigation context. Damaging events occur when the actions of a third-party cause a negative effect on the business operations or earning capacity of another "innocent" party.

In business valuation litigation, the context and details of the damaging event must be considered. Specifically, it is necessary to provide a reasonable correlation of how the damaging event resulted in the alleged damages and then be able to quantify the amount. Generally, the identification of the damaging event is a simple step. Providing a reasonable basis that a connection exists to monetary damages may be relatively simple as well. Unfortunately, the determination of appropriate related monetary economic damages is subject to considerable speculation, interpretation and debate. Add potential differences in financial modeling to the mix and it is easy to see how two parties, beginning at the same starting point with similar facts, can quickly distance themselves as they walk down diverging paths of collective assumptions.

The selection of a quality business valuation expert in an economic damages case is critical. At the end of the day, regardless of whether you are a plaintiff or a defendant in a lawsuit, it is an advantage to have an expert that is credible.

It is understood that the valuation process does not produce an absolute, but rather an estimate of, value. After all, no one can predict the future with certainty. If it was certain, there would be no debate. Two appraisers can consider the same facts, but based on selected assumptions, they can find different conclusions that may each be reasonable. It is the appraiser who utilizes assumptions that deviate further from common sense and the original facts which can be deemed unreliable.

It may be helpful to think of the successful resolution of business valuation in litigation as a matter of making expert judgments on matters that inherently involve some gray areas. To put it another way - we all recognize that individuals can look at a black ink blot and see different images. Problems arise when someone looks at the black ink blot and tries to convince others that it is a stack of red bricks. To be credible, in addition to using sound financial and valuation theory, an analysis needs to be well grounded in common sense. Selecting an expert with the ability to clearly connect the dots will help others see the valuation picture plainly.

Read more...

Business Valuations**** connection with Buying a Business

Buying a Business? 10 Expert Tips to Buying a Great Business 

Buying an established business has many advantages. The business is already equipped with experienced employees to operate it and an existing customer base. It saves efforts required to establish a business in the initial stages and you can focus on improvement of services after buying the business.
If you have decided to buy a business, the following 10 tips will surely help you in making the right decision:
1) Buying a business can also mean buying yourself a job. The business will have an effect on your lifestyle and you need to calculate the returns in comparison to man hours spent while operating and potentially expanding the business.
2) Where to find a business for sale - Businesses for sale advertisements can be found in trade magazines and newspapers or online. You can make inquiries with business advisors or accountants about any potential business for sale in the market. You also have the option of listing your requirement online and receiving notification or alerts whenever a business is listed for sale. An online research for business can also yield good results. You can also learn about pending business sales through business suppliers, competitors and customers.
3) While buying a business, a thorough research has to be done on every aspect of the business. You need to gather all information about the seller and business. The financial claims made by the seller about the business need to be verified. The due-diligence when buying a business should be done with a great attention to detail.
4) Always look at buying a business that interests you. They say 'do what you love and you will never work a day in your life,' the business must also offer a return on your investment.
5) Check if the seller will offer any vendor finance. Bank finance for buying a business can be limited.
6) Always seek professional advice from accountants and lawyers who have experience in business sale.
7) Do be mindful that the asking price of the business is not necessarily the valuation price or even close to the correct value.
8) If you happen to seek advice from a Business Broker, keep in mind that they are usually working for the seller (they work for the person that pays the commission)
9) Find out what is motivating the vendor terms and conditions can be just as important as price
10) Educate yourself on the buying process, learning how businesses are bought sold and valued its essential to make sure you achieve the very best outcome for you and your family
The Buying process is really quite straight forward. All you need is the right information and high quality tools.
It is very important to gain expert advise from people who have actually been in business and have experience buying, selling and valuing businesses. Some Business Brokers may be of assistance but essentially they are working for the Vendor and have limited understanding of Business Valuation. A professional Business Valuation Practitioner will be able to offer you an accurate business appraisal....at a pretty hefty cost.
The simple fact is, you can get a great deal without the 'middle men' and save thousands of dollars doing all the due diligence, analysis and appraisal yourself, as good as or even better than the professionals for the outcome you dream of.

For more information regarding risk factors, analysis and appraising calculations when Buying a Small Business, a recommended resource for expert, user-friendly, step by step Business Buying Information and Small Business Appraisal Software.

Read more...

Business Valuation Methods

Business Valuation Methods****An important criteria

The process of valuing a business has sometimes been referred to as more of an art than a science. Here is a fundamental truth about the valuation of an enterprise. It is only worth what someone is willing to pay for it.

You might say that this is not a very helpful statement. If you want to know the value of your business, how can you know how much it is worth before someone pays for it? You can't (exactly). But you can have a person (usually an accountant or a broker) give you a value. But what this really entails is an estimate of what the person doing the valuation thinks a willing, but not anxious buyer, who is fully informed might pay. But it is only ever going to be an estimate. The true value cannot be known until someone puts their signature on a contract with the sale price on it.

In Australia, as probably in many other parts of the world, the population, on average, is ageing. There is an enormous shift of wealth and assets from the older to the younger generations. And this means there are a lot of business sales occurring and going to occur. Now when you sell something, you have to have an idea of what you're going to sell the item for. In a business sale, the price is not often openly disclosed. The purchaser needs to make a bid for the business. Therefore the purchaser also need to get a value of the enterprise, or at least some idea of a reasonable price.

All this is to say that determining the fair value of a business is now, and is going to continue to be, an important issue. It is somewhat disconcerting to say that the value of the business is more an art than a science. Surely the value can be determined/estimated fairly accurately? Well, often not. This is because there are so many different issues that valuers take into account. Some valuers will put more emphasis on a particular issue as compared to another. One valuer will have more knowledge of an industry than another and see value in certain things that another will not and so on.

Rules of Thumb

It seems that the smaller business, the easier it is to determine/estimate its value accurately. This is particularly so where there are large numbers of essentially the same types of business. An example (in Australia) is Fish and Chips shops or small accounting practices. Readers from other countries might relate more to a take-out pizza shop.

The reason for this is that "rules of thumb" have developed in relation to these types of organisations. Often these rules of thumb are based on the turnover for the last financial year. For example, an enterprise in a particular industry might sell for two times revenue. That is, if the annual sales were $500,000, it will sell for $1 million.

On its face, this seems illogical. How can you purchase a business based on sales without knowing the profit? The reason that rules of thumb gain wide-spread use is because the rate of profitability of businesses of the same type are assumed to be about the same, or if the business being purchased has lower than the standard rate of industry profitability, it is assumed that the new owner can quickly achieve that rate of profitability due to the business being so generic.

Read more...

A Review on Performance Appraisal

How To Do Business Performance Appraisal

If you are running a business, you must have set certain objectives to achieve. In modern competitive scenario, it is not just enough to achieve those set objectives. You have many more things to look upon. You need to compare your performance with your competitors to assess your real position in the market.

Besides assessing changes in the basic financial aspects like cash flow, working capital, operating profit, cost base etc., you also need to look at the issues like customer services, employees' satisfaction level, improvement in product etc.

You Can Go For Benchmarking:
For assessing the current performance, benchmarking is considered as a useful and objective management tool. In benchmarking, a business compares its performance with its competitors or market leader or against a best -practice hypothetical model.

Most of the times, a comparison is conducted on products and services, sales, costs, pricing, profitability, quality control, number and types of customers, strategies etc.

Benchmarking is the easiest way to know the strengths and weaknesses of business. After assessing the current market share, you may develop certain strategies for improving the performance and overcoming the weaknesses.

Whether you are a service provider or a product manager, whether you are running a small business or you are a multinational company, you can opt for benchmarking anytime. But, it should be taken as a process of nonstop improvement.

How to Carry Out Benchmarking:

A business can conduct benchmarking in several ways like:

It can benchmark internally by comparing the performance of different departments exiting within the organization.

An external benchmarking can be conducted by using the industrial norms. This way a business can compare its performance with other similar businesses.

An external benchmarking program may also prove beneficial. Trade Associations, business support organizations and business consultancies conduct benchmarking programs for all kinds of businesses.

The Confederation of British Industry (CBI) also offers benchmarking. It uses the tool of 'probe" i.e. promoting business excellence. It covers manufacturers, environmental, health and safety management, people management and service excellence.

Depending upon your requirements, you can choose any of these methods. But, you have to keep in mind that the practice of benchmarking is successful only when an action plan is carried out to improve the performance. Merely assessing the performance is not sufficient.

You can also take help of special websites like:

● The Benchmark Research Website

● Institute of Directors Website

● Benchmark Index Website

● Trade Association Forum Website

● Comparison International Website

An average student has to compare his performance with other students to improve; similarly, a business has to compare its performance with its equivalents to progress. A regular performance appraisal keeps the business fit and fine.

Read more...

Selection steps for Accountant and Finance Professionals

 Financial Services Selection in Human Resource Management

An accountant can be more than just a person who prepares the accounts and talks to the taxman for you.

Over time you will find that your accountant can become a valued business advisor. Remember that they are dealing with a spectrum of local businesses of various types.

A natural by-product of this is that they will have:

• Many contacts - some probably very relevant to your own business
• Dealings with the local bank managers and a good idea of what they expect for applications such as financing in particular, the style of business plan they like to see presented to them
• The respect of other local organisations particularly banks and other professionals that will reflect well on your business
• A lot of experience in dealing with the local tax office and regulatory bodies

Professional qualifications

I can't stress enough that if you want to have a solid, long term, happy working relationship then you should always use a qualified accountant.

You will of course always be able to find other cheaper alternatives but consider this:

• Do they have enough experience and training to carry out the regulatory and governmental obligations you have. Remember, when the Inland Revenue is handing out fines for late payment or non-compliance, there is only one person who suffers - you
• Are they up to date with the latest legislation regarding taxation and company law? You see there is one main reason why established practices charge a higher rate and that is because they take a professional attitude to keeping their knowledge up to date. They attend regular updating seminars and courses which can be quite expensive as it is specialised knowledge

Other offices

You should find out whether the office you are dealing with is one office as part of a larger group or just a single practice.

This is relevant if your business is more than just a single entity such as a shop or small local business. You see as your business grows so will your need for technical assistance. There comes a point when you may outgrow a local practice and need to move on to a medium sized practice where the specialised knowledge is split amongst its senior staff.

In a larger practice there may be a partner who specialises in obtaining corporate finance, several tax specialists in different areas and partners who specialise in investigations and due diligence work, in addition to those staff who do the day to day work of accounts preparation and tax returns.

You will usually obtain a more efficient service from one practice due to pooling of ideas than having several advisors from different organisations.

Your choice of practice will ultimately come down to what size your business is and what expansion plans your foresee. There is nothing wrong with choosing a larger practice, just consider whether there is any cost implication.

Existing clients

You should consider whether the practice you are reviewing already have clients in the same line of business as yourself. This can be advantageous if you are in a specialised field as your accountant will already be up to speed on your particular requirements and this may translate into a reduced fee.

Recommendations

Naturally you should seek recommendations from as many people as you can. Particularly take note of advice given by business associates.

In addition, consider these avenues for advice:

• Local banks and other professional advisers
• Try to seek permission to contact existing clients for references, this can be an informal way of gathering great information
• See whether the practice publish regular articles in say local newspapers giving free advice to readers. This can give an indication as to the expertise of the practice.

Where to find your accountant

There are several places to look including:

• Simply, walk down your local high street and call in at reception for practice brochures
• Yellow pages - usually the professional bodies will advertise the names of local authorised practices
• Local papers and other publications
• Search online
• Contact the institutes below for a list of practices in your area

Read more...

Recruitment And Selection Process in Human Resource Management

Recruitment And Selection Process 

The most important job of a Human Resources person is the selection and hiring/recruitment of employees. It cannot be faulted that the success of any firm depends on the quality of human resources or talents in that firm. This is why it is very important for any human resources expert to be very sure of hiring the right staff without compromising anything from the onset. The questions behind your mind while sourcing for talents should be can these staff deliver? What are their strengths? Can they fit into the corporate goal and objectives of the firm? What are their competencies? Can they be trained? Can they pursue the vision of the firm? What values are they bringing into the organization? Are they coming to use our firm as a learning ground and move on with their career somewhere else? Can we count on them to fit into the succession plan of the company? Etc. Answers to these questions and more are why selection and recruitment seems to be an onerous task. It cannot be argued that most applicants fake their qualifications and experiences just to impress interviewers and get the job. It is very important then for interviewers to look beyond the physical to determine how suitable an applicant is. This brings us to the issue of the competency analysis of those to be interviewed. Competency test is always one of the important selection strategies. This is because it goes beyond what eyes can see. It checks the behaviours of the applicants as well as their characteristics, which influences and drives their performance on the job. A competency can then be seen as the underlying characteristics of a person which enables him to deliver or not deliver superior performances in a given job, role or situation.
The competency of a candidate can be seen in his Skills, educational qualifications, Knowledge, abilities, achievements, strengths, social roles, self image, Traits and Motives. Where the candidate's skills, educational qualifications, knowledge, abilities, achievements, strengths and weaknesses can be easily identified, his Traits and Motives are always hidden in the core of the candidate. The Motive and Traits of different candidates are always what separates the chaff from the juice. This then means that interviewers should pay more attention during selection exercises in the motives and traits of candidates more than their qualifications and experiences.
When there is an opening in a firm, it is always very important for the Human resources department to check inwardly if there is any existing staff that can fit perfectly into that position. If none, the next step should be to look outwardly. While placing the advert, it is also very important for the HR person to know the job requirements for that position, the educational qualification needed, number of years of experiences on the job, the job description, the gender of the person needed etc. These will help in knowing the content of the advert placement.
It is also always very important for the advert to specify that each candidate should have his profile and career summary in the first page of the resume. This will make the short-listing job simple.
Bearing all these in mind, the selection and recruitment process will flow as easy as ABC. For a guide, a typical selection and recruitment process should follow the sequence below:
Be aware that there is a vacancy / opening in your organization.
Analyze the position/s requirements. Learn everything about the job, the processes, performance; the skills needed, the traits, the competencies, salary range etc.
Vacancy announcement. Place the vacancy in your website as well as in one or two dailies as the case may be. Be sure the daily you are to use has wide readership.
Start your short listing, having in mind the job description and requirements.
Depending on the number you have in mind, shortlist many candidates for the pretest selection to give you a variety of choice.
Conduct the test exercise (for entry job levels mostly).
Prepare interview questions for the pre-screening interview.
Conduct the pre-screening interview (to trim down the number of candidates.)
Prepare more practical questions for the next stage of the interview.
Make your selection and present to the Management for the final selection.
Conduct your background checks/reference checks on the successful candidates.
Recruit the successful candidates.
Conduct employee orientation.
Hand over a copy of the employee Handbook to each of them.
Place them on probationary period before confirmation of appointments.

Read more...

Avenues for project management professionals

Project Management Professionals - Top Tips For Becoming a Successful Professional 

The first thing you should do if you are serious about starting a career in this field is check into getting certified through the AAPM, or the American Academy of Project Management. They offer different types of certifications which will give employers confidence in your abilities and you can obtain these certifications in whatever order you please.

One of the most common certifications is the MPM, or Master Project Manager. This certification is recognized around the world and you can use any prior education or work history in the field to waive part of the instruction, speeding up the process considerably. To obtain the AAPM Project Management Professional certification you will be required to go through three years of classroom study and work experience in the field. Two other options are the CIPM (Certified International Project Manager) and the PME (Project Manager E-Business).

The Project Management Institute offers a variety of different certification programs which will make you employable in a variety of different aspects of the field. For instance, you could start with your PMI and advance into other programs such as the Certified Associate of Project Management (CAPM) or the Program Management Professional (PgMP) programs. There are also more specialized options such as the PMI Scheduling Professional program (PMI-SP) and the PMI Risk Management Professional program (PMI-RMP).

If you have the basic ability to coordinate and motivate a group of people to achieve a common goal and have excellent communication and managerial skills, then chances are you could be successful in this field. Just understand from the beginning that you will be expected to continually advance your education at the graduate level and abide by the strict ethic guidelines of the industry. You may even want to become specialized in particular aspects of the industry with time.

Thanks to the growth of e-commerce, more people are now entering this field by studying for their MBA or Master of Science in Project Management through the Internet in their free time. As industries and commerce continually change, this industry will change and adapt as well.

The more experience you have working as Project Manager, the easier it will be to obtain advanced certifications which make you more in demand for the more prestigious positions. You just need to seek the certifications and take credits for any experience you already have in the field.

As a Project Management Professional, you can expect to earn anywhere from $80,000 to $120,000 annually once you gain certifications and experience. The higher end of this pay scale is for certain specializations such as those working as an IT Project Manager or a Business Analyst. If you continually get higher certifications this can be an extremely lucrative career.

Read more...

Web Based Project Management System

How a Web Based Project Management System Can Help Your Team to Develop 

Web based project management system works to complete the business projects in an efficient and effective way. This system comprises of tracking, scheduling, calendar, reporting, and most of all the team development, and communication system. These web based project management systems help to strengthen the teamwork. Under the guidance of this automated system, the team members give their best for achieving goal.

The web based project management system helps you in the selection of the project. It works on the basis of project management software. This software predicts the feasibility of the project on the basis of the entered information. Utilising all the available elements, it presents a feasibility report before the initiation of the project. The market contains an array of the project management software; you can always select any one as per your requirement.

This web-based system provides efficient tracking system during the project. It alerts the team leader, or the project manager about any fault in the project. It prevents the project to go off-track. Moreover, this efficient management system ensures the in-time completion of the task.

This system does not require desktop installation, and is installed by the server. The project administration system guides you about the required specialities for the accomplishment of the project. Once the team leader has been decided, it facilitates the communication between different divisions of the project. It enables the leader to communicate with the members of the project. Thus, a proper team is established that can easily communicate, and collaborate at any time irrespective of their location.

The web based project administration system not only enables the team leader to communicate with worker, but also let the workers to communicate with each other. The system centralises the data. This centralised data can be assessed by anybody. Thus, the workers can easily get information about their daily tasks without any problem. In case of any discrepancy, the efficient communication system enables them to contact the team leader instantly.

The web based project administration system enables you to host real time presentations webinars, and the team meetings. It can accommodate maximum real time participants in a meeting. The system can also make use of the teleconferencing, VOIP, text chats, and screen sharing. These tools can make the live conferencing more efficient, and effective.

The web based project management system not only facilitates the development of the team, but also holds it accountable. The team leader can always view the daily progress of the team members. Whenever any team member is found to be incompatible with his task, the duties are assigned to the other member for the smooth and steady completion of the task.

The software keeps the record with the help of the computerised timesheets. It carries all the data regarding the working hours, and the performance of the team. Moreover, the matters related to the wages of the workers are also solved through this management system. Thus, the web based project management software is a handy tool to build up an efficient teamwork. When all the factors are united, they result in the successful and in-time completion of the project.

Read more...

Project Management Softwares

Applying Online Project Management Software

The computer and Internet access has helped many of businesses. It's especially helpful when project managers get a handle on online project management software, which effectively helps managers handle all aspects of the project so no money is being wasted or lost. The sheer logistics of any project or projects can be daunting and further, it is likely someone does not account for one part of the project or another. This causes a disruption in the progression of the project. But the best part about web based project management software is that all of the logistics (including the budget) are quantified in effective ways to allow managers to see progress at every step.

All businesses that are web based can take advantage of the features of project management. Whether it's bake shop, bank, landscaping, or construction, the software will help all team leaders. The software is also customizable to fit any business. With the tools that are available team leaders will be able to input what they want and what they don't want.

Web based project management tools include reporting, budget analysis, user customization, resource allocation, scheduling, document sharing, and time sheet modules.

Using software such as this is great for one project, but it's also great for multiple projects. As a multiple project team leader, the pressure can be taken off by using software that is solely designed to help your needs. Allow your company to succeed. Project software is the best way to do it because all of your resources will be accounted for and you can watch the money flow back into your business.

Read more...

Prospective project management career

Project Management Career

A Project Management Career Is Ideal For Someone Who Has Good Leadership Skills

The job of a project manager is to oversee the process of a project and assure that the necessary steps are taken for the project to come to fruition. An individual who desires to pursue a project management career must be able to handle a leadership role, and deal with authority in a professional manner. This individual should be a natural leader who has an eye for detail and is competent at follow a reestablished process.

An individual who selects a project management career should be able to manage, plan, organize, manage, and control all phases of a project. The tasks that are associated with this position involve determining the objective of the project. Once they determine the objective they need to establish the means to reach this objective, this will typically involve utilizing resources and procuring the necessary staff and equipment to achieve the objective.

This individual needs to be able to take suggestions from their staff and work as a team leader to accomplish the objective. Someone who tends to take a dictatorial approach to things would probably not make a capable manager. They must be able to take a leadership role and get others to follow them, yet be able to instill in their subordinates that they are taking the proper steps necessary to achieve the objective.

Part of the planning stage of any project is to determine what tasks will not to be completed and find someone who can be delegated that project. They must be able to judge character and determine which individual will be best suited for each task. The best project manager is able to assemble a team that will operate proficiently with the minimum amount of on hands leadership. The team they assemble should be able to do the tasks and report back to the project manager without needing a babysitter.

There are needs for individuals who are pursuing a project management career in many different industries. There is a need for project managers of one type or another for just about every type of work there is. One popular type of project manager is a wedding planner.

Read more...