Methods of assessing the value of companies: proposition application in a company providing accounting services

Abstract

Every day the companies are evaluated for enumerate reasons. However, the company evaluation as a whole is extremely difficult and subjective. The main difficulty is the fact that the value of the company is not perceived equally by the buyer and the seller. The literature suggests several methods of evaluation that can resolve these different perceptions of value. The choice of the method more appropriate is a responsibility of the person in charge of the evaluation, which means, it is the one with accomplish the expectations of both parties in the negotiation involved. Thus, the most important focus should be on the evaluation process and not it in the final result. The present work aims at searching, among the various methods, a methodology for evaluating a company providing accounting services, known popularly as accounting firms. In relation to the methodological procedures, it is a literature search, supplemented by a case study. It was identified by the authors surveyed the discounted cash flow is one of the most widespread and applied methodologies for determining the company value. From this discovery we applied this method to obtain the valuation of the company under study.