In family law matters, the division of assets can be a complex process, often involving more than just real estate and personal property.
It's not uncommon for one or both parties to have ownership or interests in a going concern business, which can be held individually, jointly, in partnership with third parties, or through company or trust structures.
Regardless of the operational structure, if one party has an ownership interest in a business, that business becomes part of the asset pool to be considered in the settlement. Therefore, a business valuation is required.
The Importance of Business Valuations
Small and medium-sized enterprises (SMEs) often do not have a monetary value attributed to the business on their balance sheets, especially those established by the current owners rather than acquired from a third party. A business valuation enables a quantifiable value to be placed on the going concern business, ensuring it is accurately included in the marital asset pool. This valuation, which is crucial for a fair and comprehensive settlement, reassures both parties that their interests are being considered equitably.
Timely Valuations Key to Minimising Disruption
For businesses where the parties are actively involved, the timing of the business valuation is crucial. Conducting a valuation at the earliest opportunity not only ensures a fair and comprehensive settlement but also helps maintain business stability. Delaying this process can lead to prolonged disruptions, negatively impacting business performance, profits, and, ultimately, the business’s value. A timely valuation, on the other hand, supports both parties in moving forward more efficiently.
Updated Financial Records
Accurate and up-to-date financial records are essential for a swift and effective business valuation. When financial documents are readily available, the valuation process can proceed quickly, often in tandem with real property valuations. This holistic approach provides a complete financial picture of the marital assets, allowing for a speedy settlement.
The Benefits of Engaging a Single Firm
Engaging one firm for both real property and business valuations significantly streamlines the process. It eliminates the need for the parties to provide a myriad of different documents to different valuers, reduces the chances of miscommunication, and ensures all relevant information is considered. Valuation inspections can be coordinated, reducing disruption to the parties' everyday lives and the operations of the business.
Fewer disruptions, a single point of contact, and a streamlined process are conducive to reducing distress during a very stressful time for all involved.