Reasons you may require a valuation
Thanks to Tony Vidler’s email for pointing out that Advisorpedia has an article: “Six events that require a valuation of your financial practice” - it is well worth a read, which will only take two minutes. In case that’s too long, here are the six reasons as headings:
Acquisitions
Loans
Internal succession planning
Mergers and teaming
Divorce
Charitable contributions
But it is worth exploring the reasons in more detail - so do click through and read. We think the New Zealand tax context means that the last reason does not apply. We also think that - wherever you are - we would add at least one more reason: managing for value. Although as a business owner your income and investment return are the day to day ways you receive value for what you do, the sale of the business - or even just parts of the business - will probably become important in the future. Remember, one day you will not own your business. Between now and that day you should probably be actively managing your business to increase its value. If you don’t measure it you can’t keep accurate track of how you are doing.