Business valuation FAQ

Fees are fixed and quoted in writing before work starts. An indicative assessment for a small owner-operated business sits in the low four figures. A formal valuation report for an established SME sits in the mid four figures. Multi-entity groups, court-appointed single expert work and loss and damages quantification move into five figures. The fee is driven by entity count, record quality, purpose and whether expert evidence is required — never by the value concluded.

Because the word "valuation" covers everything from a one-page rule-of-thumb estimate to a court-ready expert report. A cheap quote usually means a short-form calculation with no cross-check, no asset work and no declaration — fine for a rough internal view, useless in front of the ATO or an opposing expert. Always compare the deliverable, not the price.

No. Charging a percentage of the value gives the valuer an interest in the answer, which destroys the independence the report depends on. Our fee is a fixed dollar amount agreed before work begins.

A valuation obtained for an income-producing or business purpose — tax compliance, a dispute, an insurance claim — is generally deductible. A valuation obtained as part of acquiring or disposing of a capital asset usually forms part of the CGT cost base rather than an immediate deduction. Confirm the treatment for your circumstances with your accountant.

A short-form indicative assessment takes 3 to 5 business days. A formal valuation report takes 10 to 15 business days from the date complete financial information is received, not from the date you engage us. Court-directed single expert reports run to the court timetable, typically 4 to 8 weeks.

Usually yes. Tell us the deadline on the first call. Where records are clean and there is one entity, a formal report can be compressed, and where a court or ATO date applies we schedule to it. What cannot be compressed is waiting on missing documents.

A valuation is an opinion at a specific date. As a working rule it stays useful for 6 to 12 months if trading is stable, but any material change — losing a major customer, a big contract win, a change in the industry, a new financial year — resets it. Court and ATO purposes generally require a valuation at a specific prescribed date rather than a current one.

Twelve to eighteen months before you go to market. That is enough time to act on what the valuation reveals — reducing owner dependence, contracting recurring revenue, cleaning up the add-backs, diversifying customer concentration — which is where the value is actually created. A valuation obtained the week before listing tells you the score without giving you time to change it.

Three years of financial statements and tax returns, the current year’s management accounts, an aged debtors and creditors listing, the asset and depreciation register, lease and finance agreements, key customer and supplier contracts, the shareholder or partnership agreement, and details of owner remuneration and non-recurring expenses. Most businesses assemble the full set in an afternoon with their accountant.

It is common and it is workable. Missing records widen the range and increase the fee, because more has to be reconstructed and more caveats have to be disclosed. Tell us up front rather than letting us discover it in week two — a valuation built on undisclosed gaps is the one that gets attacked.

Yes, for the significant ones. Customer concentration, contract length, termination rights and change-of-control clauses all move the multiple. A business where the top customer is 40 per cent of revenue on a 30-day term is worth materially less than one with the same profit spread across fifty contracted clients.

Add-backs are adjustments that restate reported profit as the profit a new owner would earn: an above or below market owner salary, related-party rent, personal expenses run through the business, and genuine one-off costs. They are the single most contested part of any valuation, so every add-back in our reports is listed and justified line by line rather than lumped into a total.

Profitable businesses with three or more years of consistent trading are usually valued on capitalisation of future maintainable earnings. Businesses with contracted or rapidly changing cash flows use discounted cash flow. Asset-heavy or unprofitable businesses are valued on net asset backing. Market comparables serve as a cross-check in almost every engagement rather than as a standalone method.

Most Australian SMEs transact between roughly 2.0 and 5.0 times normalised EBITDA. Hospitality and retail sit at the lower end from about 1.8 times; professional services and transport around 2.5 to 4.0 times; healthcare around 3.0 to 5.0 times; IT and SaaS businesses reach 4.0 to 7.5 times. Size, owner dependence, recurring revenue and earnings trend move a business within its sector band.

Goodwill is the residual between the total value of the business as a going concern and the fair value of its identifiable net tangible assets. It is derived, not assumed: the business is valued on future maintainable earnings, the net tangible assets are deducted, and the remainder is goodwill. Heavy owner dependence reduces transferable goodwill, which is why owner-operated businesses often sell for less than their profit suggests.

EBITDA is a reported accounting figure. Future maintainable earnings is a valuation judgment: EBITDA adjusted for a market salary for the owner, related-party rent brought to market, one-off items removed, then weighted across several years to reflect what a new owner could sustain. In an owner-operated business the gap between the two is often 20 to 40 per cent.

In order of impact for most SMEs: reducing dependence on the owner, converting revenue to recurring or contracted, spreading customer concentration, demonstrating a consistent upward earnings trend, and documenting systems so the business transfers cleanly. Together these commonly move a business a full turn of EBITDA or more within its sector band.

Yes, in-house. Asset Valuations Group values property, plant and equipment as part of the same engagement, so the asset schedule inside your business valuation is evidenced by a valuer rather than taken from the depreciation register at book value. That schedule is usually the first line an opposing expert or ATO reviewer tests.

Yes, where the report meets ATO market value substantiation guidance: a defined standard of value, a stated valuation date, a documented methodology, disclosed assumptions, supporting evidence and a signed declaration from a qualified valuer. A broker’s appraisal or a rule-of-thumb estimate does not meet that standard.

Yes. We accept single expert and shadow expert appointments and prepare reports to the expert evidence rules of the Federal Circuit and Family Court of Australia, including the expert’s declaration and duty to the court. Our lead valuer has extensive experience giving expert evidence, and we attend conferrals and court where required.

An appraisal is an informal price opinion, usually free, often given by a party who benefits from a sale, with no professional standards behind it. A valuation is a formal opinion of market value prepared by a certified valuer with a defined standard of value, stated methodology, disclosed assumptions and a signed declaration. Only a valuation is defensible to the ATO, a lender or a court.

A minority discount reflects that a non-controlling parcel of shares cannot direct dividends, salaries or a sale, so it is worth less per share than a controlling stake. Whether it applies depends on the purpose of the valuation and, in a shareholder exit, on the wording of the shareholders’ agreement — which is why we read the deed before we start rather than after.

A Certified Practising Valuer of the Australian Valuers Institute prepares and signs every report. Business valuations are led by Jarrad Khoury, Head of Valuations; asset and plant components by Paul Khoury, with 42 years in the industry; property components by Anthony Khoury. Work is not outsourced or delegated to unqualified analysts.

Yes. Every engagement is covered by a confidentiality undertaking and your information is used solely for the valuation. Where a report is prepared for court proceedings, disclosure is limited to what the expert evidence rules require.

Yes. We are based at 4/144 Edward Street, Brisbane City and regularly value businesses across South East Queensland, regional Queensland and nationally. Our valuers hold registrations in Queensland and Western Australia, and our directors cover Victoria and New South Wales.

Call us and we will walk you through the reasoning. If you can point to a factual error — a missed add-back, a contract we were not given, an asset valued incorrectly — we will correct it, because an inaccurate report helps nobody. What we will not do is change a conclusion because a party prefers a different number; that is the whole point of an independent valuation.