As part of the marital dissolution, couples wil need to determine the value of their property and divide assets. For certain types of property, such as bank accounts, the process is relatively simple. However, if one or both spouses are business owners, determining an equitable asset split can be more complicated. There are three general approaches to determining a business interest’s fair market value:
Asset Approach: the company’s value is based on its assets in excess of its liabilities
Market Approach: the company’s value is based on comparable companies sold in similar markets
Income Approach: the company’s value is based on current and past economic data used to forecast future financial benefits and then convert those forecasted numbers to a current value
In most cases where a business interest is of significant value, it is imperative for a qualified valuation professional to be part of the marital dissolution process. Business Valuation, Inc.’s valuation experts use their training in economics, finance, and accounting, as well as real-world business experience to analyze the economic issues determining a business interest’s fair market value.