01 — What is an appraisal?

An appraisal is a professional opinion of value. Appraisals come in many forms, such as oral testimony, restricted report, or a traditional appraisal report. An appraisal report contains the methods and techniques used in the valuation process. Click here for a walk through of the parts of an appraisal.

Sometimes an appraisal doesn't fit your needs, but a broader valuation service is needed. If you aren't sure what you need, schedule some time with me to discuss.

02 —Who needs appraisals?

Most of my clients are CFOs, bankers, risk managers, and developers. Still, I also work with individuals, tax planners, and early-stage businesses. Regardless of role or specific needs, these people are looking for fact-based third party opinions to give them the confidence to make important business decisions such as funding a transaction, complying with audit requirements, writing insurance policy, appealing their taxes, or resolving a dispute. Click here to see different appraisal uses.

03 — Why do I need an expert?

If you buy, sell, and work with assets, I bet you already have a good idea of what the value of your equipment is worth. Rarely do I come across projects where my clients, the subject, and everyone in-between don't already have their minds made up on what the value is. For the most part, they are all not far off.

So why do you need an expert? Well, an expert understands the appraisal process and can approach the value from a perspective that is fair to all parties. The buyer may see they are already providing goodwill because a business will grow with their support. A seller may see that opportunity lost. Their advisors may see a number that fits best in a spreadsheet. With an appraisal, you have a third party opinion in which each side's perspectives are considered and explain in a report adhering to professional standards.

04 —What are the steps of the appraisal process?

Once an appraisal scope is determined in which the intended use is determined, the typical appraisal has the following steps:

• Information Gathering

  • Request for documentation

  • Conversations with financial and engineering staff

  • Site Visit or review of the site plans

• Valuation Research

  • Investigation of current trends in the industry & subject companies place in the economy

  • Market research 

  • Index and trend analysis

• Application of methodology 

  • Cost Approach

  • Market Approach

  • Income Approach

• Conclusion of Value

  • Draft Report & Analysis

  • Audit & Discussions

• Final Appraisal