Why cant I use a store-bought software program and do the valuation myself?
A business valuation software program cannot perform a business appraisal in accordance with The Uniform Standards of Professional Appraisal Practice or The Business Appraisal Standards of the Institute of Business Appraisers or Revenue Ruling 59-60. These industry standards, among other things, govern the methodology of developing the information that is actually used in the calculations of an appraised value. If the information that is entered in the software is not prepared correctly, the results will be unreliable at best. Borrowing from the computer industry, garbage in garbage out. In addition, off-the-shelf, non-professional software programs often use an average of as many as ten or twenty different methods of valuation to arrive at an estimate of value. More is not better. Under no circumstances would all methods of valuation be appropriate in every appraisal assignment. In fact, the use of the estimates of value derived from all methods all the time will always render erroneo
