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REA CPD - Business Sales: Appraisals


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REA CPD - Business Sales: Appraisals

Price: $ 29.95+GST

A critical part of a licensee’s business sales role is carrying out a thorough appraisal of a business and presenting this to the potential vendor client. Licensees need to convey the appraisal to the potential vendor clearly, concisely, and with all required information included. The sale of a business is a significant transaction, and the potential vendor client needs to be provided with accurate, well-researched information to make an informed decision on whether to sign an agency agreement, and ultimately whether to proceed with a sale.

Table of Contents

Real Estate CPD – Business Sales: Appraisals, covers the following information:

  • Contents
  • Learning outcomes
  • Terms used in this guide
  • Introduction
  • Part One: Requirements for appraisals
    • What is the difference between an appraisal and a valuation?
    • Legal requirements for an appraisal
  • Part Two: General process for appraisal of a business
    • Significance of the size of the business
    • General appraisal process
      1. Find out the nature of the appraisal
      2. Gather facts/story about the business
      3. Assess internal risk and opportunity factors related to the business
      4. Assess external risk and opportunity factors related to the business
      5. Gather information on the accounts and the business profitability
      6. Find an estimated market value using appropriate methods
      7. Compare results from different methods to arrive at the appraisal value
      8. Apply a ‘sanity test’ to appraisal value or appraisal range
      9. Write up a report for the prospective vendor client
      10. Present the appraisal report to the prospective vendor client
      11. File all appraisal working documents, calculations and notes
    • Information provided to potential buyers
    • Where the accepted offer differs significantly from appraisal
  • Part Three: Updating an appraisal