Tag Archives: Normalization

The Doomsday Ratio

Is your company prepared to survive a Doomsday scenario? Without quantifiable measurements in place, it may difficult to know how your business is actually performing. Financial ratios or benchmarks are used to assess the financial health of a company. The company’s financial statements, primarily the income statement and balance sheet, are converted to a standardized […]

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Quality of Data Drives Deals

The quality of data is the most commonly overlooked risk factor of business owners pursuing a sale of their business in the marketplace. Owners must be able to provide prospective buyers with evidence to support their earnings and their adjustments to earnings. Poor data quality is usually linked to: Antiquated accounting systems Incorrect revenue recognition […]

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Be Prepared!

It is impossible to list all the issues and decision points that may arise in the course of selling or preparing your business for sale. Every Merger & Acquisition transaction is different. A successful sale requires early preparation from the seller to optimize the sales value of their business and minimize the risk of a […]

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Delta Services, LLC has been acquired by The State Group, Inc.

ABOUT THE DEAL: Delta Services, LLC has been acquired by The State Group Inc. Established in 2004 and headquartered  in Louisville, Kentucky, Delta Services is a privately-owned, bonded and fully-insured electrical contractor specializing in various types of electrical construction, communications systems, fire and security systems, safety services, utility distribution services, and PLC controls. Headquartered in […]

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Normalizing Adjustments & The True Company Value

Although a detailed analysis of the financial statements reveals pertinent financial data, the true value of a Company requires that normalizing adjustments be made to the financial statements. Normalizing adjustments reflect a more accurate financial performance, both historically and projected. Normalized financial statements also help determine the Company’s future cash flows, and assess its financial […]

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Calculation of Value: The Precursor to an Exit

Business owners contemplating an exit from their business should begin the transaction process by engaging an experienced M&A Advisor to perform a Calculation of Value. Although the requirements for a calculation engagement may be more limited than for a valuation engagement, business owners should expect an efficient and systematic approach to the calculation of their […]

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Normalization of Income

“Normalizing Adjustments” are essential to value a Company and to make meaningful comparisons between a Company’s past and future performances. The normalization of the financial statements should reflect a willing buyer’s expectations for operating results and assist in determining the appropriate future cash flow stream. In order to minimize confusion and disagreements between Buyer and […]

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Do ‘Rules of Thumb’ Work for Business Valuations?

Rules of Thumb are used every day to help business owners place a sales value on their business. These “rules” are quick, simple and easy to apply; however, they are only the beginning in the process of determining a business value. Many of these rules belong in one of two categories: A multiple of gross […]

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Valuation: What Is the Value of My Company?

The uses of business valuations are almost unlimited: buy/sell agreements, fairness opinions, purchase price allocations, estate planning, gift taxes, charitable contributions, shareholder transactions, Employee Stock Option Plans (ESOPs), solvency and insolvency opinions, collateral valuations, litigation support, etc. When selling one’s business, clarifying the seller’s goals and measuring those goals’ financial needs with the proceeds from […]

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