Some commentators have argued that the credit crunch has resulted in a Essay

Some commentators have argued that the credit crunch has resulted in a shortage of funds being made available to small firms - Essay Example It entails changing ones course towards new things that are considered more creative in generating ones desires. Growth of medium and small businesses encompasses an increment from a low level of business to an advanced level, covering operations over a large scope. There is a wide variety of business forms depending on their size, management, as well as proprietorship; and ranging from public corporations, private companies to the smallest businesses that are singly owned. The operations of each form of a corporation may take several courses where some come together to operate as a group, while others remain singly operated (Smallbone, 2008). For successful enterprises operations, valuers and policy makers or even the proprietors always find it necessary to value companies according to the prevailing operations. Valuation is crucial for it assists the concerned parties in making appropriate decisions as well as laying the corporations on a scale, a factor that helps predict the futu re direction of the companies. More so, different techniques and approaches are employed in the companies’ valuations, which are carried out depending on the form of the company at hand. Private company valuations are thus deemed very important in the day-to-day running of the corporations. There is a need for employment of different techniques in the valuation processes to enhance a comprehensive cover, since each technique yields distinct Results. This paper is aimed at investigating into the valuation of private companies and several valuation techniques in details. Additionally, it will be crucial to establish the advantages and disadvantages of the several methods herein discussed as well as the other alternative methods that could as well be used in the valuation processes in regard to private companies (Bridge, et al., 2003). Valuation of private companies Company valuation is a process that entails the utilization of a sequence of procedures in estimating its value. T his process is mainly carried out by valuators, who come up with a comprehensive report concerning the company’s assets and liabilities. Financial participants in the market mainly use the valuation as a basis for price discussions when the company is on sale. Earlier research has not established a professional method or approach that provides an actual value of a particular company, but numerous approaches and techniques are considered important in determining the value of a company. The current available used techniques only provide an estimate of what the company is worth. Various factors are always considered when valuing a company depending on whether the company is privately owned or publicly owned. Valuation processes are carried out with a lot of caution, considering the company’s assets quality, the nature of its liabilities as well as the intangible assets. It is beneficial to value a company’s assets since it helps the investors in making sound decisi ons concerning their company. Additionally, it is often important in giving prospective buyers some confidence due to the full awareness of the