What Is a Chartered Business Valuator?

What is a Chartered Business Valuator?

The designation: The Chartered Business Valuator (CBV) designation is the premier credential for professional business valuators in Canada. Chartered Business Valuators (“CBVs”) are financial professionals who hold this designation granted by The Canadian Institute of Chartered Business Valuators. They are nationally recognized and provide business valuation expertise in the areas of compliance, disputes and corporate finance.

Quantifying worth: CBVs quantify the worth of all, or part of a business or its securities. They have the ability to determine the value of tangible and intangible assets, including brand and intellectual property, and then explain their rationale in an easy to understand manner.

Respected and recognized: The opinions of CBVs are respected and recognized by the courts in shareholder, partnership, securities, intellectual property and marital disputes, damage quantification, insurance losses, personal injury claims, patent infringement, and breach of contract cases.

Although I work independently, I have access to other CBV professionals within Atlantic Canada that allow me to obtain secondary review and, where necessary, technical assistance. It is standard process at my firm to have second person reviews by professionals not influenced by group thinking. Independent firms are more adept in thinking outside the box. I have restricted my valuation practice to private sector businesses that have less than $100 million in revenue.

My independent status is important to my clients and I. Accordingly, I do not perform real estate or equipment appraisals. I ensure these services are carried out by independent professionals. There are a wide variety of well-written and documented databases available to the independent valuator and I subscribe to several private company transaction databases which allow me to test my valuation conclusion.

We often get asked “why should I bother valuing my business?” Here is a short rundown of reasons small business owners need a business valuation:

1. Someone else will value the business anyway. For bank loans, the bank will value the business, so the owner will want to demonstrate a higher valuation. Also, the Canada Revenue Agency may value it upon a sale or estate transfer.
2. A potential buyer shows up. The business owner needs a firm grip on value in case a potential buyer makes a lowball offer.
3. Retirement needs. For many small business owners, their business is the main asset in their retirement plan. You can’t plan retirement income without knowing the value of the plan’s main asset.
4. Estate and Succession planning. Business owners who have various assets and want to leave equal amounts to heirs need to monitor the value of the family business to make sure none of the heirs get shortchanged.
5. Key person planning. A business valuation can serve as a baseline value when designing growth incentives to reward key persons in the business.
6. Court challenges. Business valuation issues do end up in court, so a business owner needs all information available to fend off legal challenges