Questions to Ask a Potential Business Appraisal Firm
Updated: September 09, 2009
- Does the firm require its appraisers to be active members of the American
Society of Appraisers (ASA) Business Valuation Discipline?
(The ASA is the only recognized national appraisal association that tests
and accredits business appraisers and is a member of the Appraisal Foundation.
The Foundation is the quasi-governmental governing body that determines acceptable appraisal standards and appraiser qualifications.)
- Do the senior appraisers have one or more advanced professional credentials,
such as: Chartered Financial Analyst (CFA); Masters of Business
Administration (MBA); Fellow of the American Socitey of Appraisers (FASA);
Accredited Senior Appraiser (ASA); Accredited Member (AM);
Certified Business Appraiser (CBA)?
- Are the firm's appraisers experienced as business appraisal expert
witnesses in Federal and State court systems?
- Does the appraisal firm, its reputation and its valuation methodology
meet both legal and perceptual independence standards?
- Has the firm performed business valuations for a broad cross section of
industries?
- Does the appraisal firm have experience in performing business
valuations for a variety of purposes, such as:
Allocation of Value
Business Dissolutions
Buy/Sell Agreements
Charitable Contribution
Damages
Dissenting Shareholders
Divorces
Due Diligence
ESOPs
Estate Tax and Tax Planning
Fairness Opinions
Financing Opinions
Financing
Gift Tax
Going Private
Leveraged ESOPs
Recapitalization
Financial Reporting
Stock Options
- Does the appraisal firm work exclusively in the area of appraisals?
(Some firms may be more interested in non-appraisal seminars, investment
banking, administration of ESOPs or pensions, ESOP promotion, or
insurance sales.)
- Does the firm have enough full-time appraisers to provide for a balanced
work environment and support for unique appraisal situations?
- Does the firm complete projects in 30 to 60 days from the receipt of all
data and authorization to begin work?
- Does the firm require annual continuing education in business valuation
for all its appraisers?
- Does the firm staff teach courses, seminars and continuing education
classes for recognized professional associations?
- Does the appraisal firm prepare all full valuation reports in conformity
with the "Uniform Standards of Professional Appraisal Practice" as set
forth by the Appraisal Foundation?
(The Appraisal Foundation, has been recognized by the United States
Congress in legislation as the standards and qualification setting
organization for the appraisal profession.)