Frequently Asked Questions - Why Have An Appraisal?

In many situations, it is essential that an independent, unbiased professional determine value including:

NEW LOANS and ASSET-BASED LENDING - A value must be determined to establish collateral requirements.

MERGERS and ACQUISITIONS - when buying or selling a business, a Fair Market Value must be determined including consideration of value for minority interests.

FINANCIAL PLANNING - For planning and funding future personal and business financial needs and meeting potential tax liabilities.

LITIGATION - Lender liability is the most common area where a valuation professional is required.

EMPLOYEE STOCK OPTION PLANS (ESOPS) - Closely-held businesses that offer ESOP plans require an annual valuation to meet IRS and ERISA requirements.

ESTATE, GIFT TAXES, and DONATIONS - A well-documented value is necessary to support reported information to the Internal Revenue Service.

DIVORCES - A fair and independent value which can be supported with testimony is essential to ensure settlement and distribution of community assets.

OTHER REASONS - Buy/sell agreements, fairness opinions, partnership dissolutions, leveraged buy outs, "squeeze out" mergers, bankruptcy proceedings, and insurance valuations. 

Why have a professional appraisal?

Valuation is a complex and demanding field requiring training, experience, judgment, and continuing education.  The professional appraisal is able to keep abreast of changes in appraisal theory and techniques, markets, economics, legal procedures and rulings, as well as regulatory agency standards.  The professional appraiser is familiar with IRS valuation guidelines and the necessity of performing an appraisal to comply with applicable Revenue Rulings.

The professional appraiser will work closely with owners, attorneys, accountants, and other specialized appraisers in a team effort to prepare a valuation suitable for each situation.  This dedication yields accurate, defendable, cost effective service for the client.

Appraisers will develop replacement and/or reproduction cost, market values, and liquidation values.  They provide estimates determining effective age and future residual values to the leasing, financial, and accounting markets.

If the valuation is challenged, the professional appraiser will be experienced and capable of providing expert witness testimony.  They will provide a knowledgeable "third-party" viewpoint for the court to use in rendering decisions.