Page 9 - FINANCE PART 2 - 9. Valuations

VALUATIONS
Introduction

• When preparing for a successful sale, an entrepreneur
should obtain proper professional advice and further

ensure that certain key areas are given the appropriate

attention.

• Investec (2013) highlighted the importance of

• clean and consistent accounting records

• clear and well-documented agreements, governing key
relationships (such as exclusive distribution rights)

• a clear understanding of the various drivers of value, for

purposes of a business valuation

• a clear understanding of the components of a business and how
they dynamically interact with other components where a
portion of the business will be retained (also for purposes of a

business valuation)
• strong legal agreements, such as shareholder agreements

• In addition, an entity should ensure proper compliance

with tax laws.

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