Intermediate Business and Securities Valuations

Intermediate Business and Securities Valuation

MODULE 1: Going Concern – Capital Rates and Market Rates

In this module, you will gain a comprehensive understanding of the:

• Comparable company multiples approach, which is discussed in greater detail in the public company multiples approach and the precedent transaction multiples approach; and

• The cost of capital, including the cost of equity, the cost of debt and the weighted average cost of capital.

This module is presented in two parts:

• Part I: Comparable Company Multiples Approach; and

• Part II: Cost of Capital.

MODULE 2: Reconciliation of En Bloc Value

This module is designed to improve your understanding and derivation of the en bloc value of all issued and outstanding shares of a company before considering how to allocate en bloc value amongst all security classes (discussed in Module 2) and discounts that may be applicable to common share value (discussed in Module 3).

• Price versus value;

• Equity versus enterprise value;

• Goodwill derivation from en bloc value; and

• The reconciliation of going-concern valuation approaches.

On completion of the notes and assigned readings in this module, you will have an opportunity to demonstrate your knowledge by completing the Quick Quiz at the end of this module and applying the approaches and techniques in the Assignment and Case Study in Module 5.

MODULE 3: Valuing Shares

Module 3 is designed to improve your understanding of some common situations giving rise to the valuation of shares and the general approaches that the valuator can use when valuing individual shares or share classes.

In this module, you will gain a comprehensive understanding of the:

• Allocation of value;

• Other classes of debt/equity;

• Valuation approaches for preferred shares;

• Rights and characteristics of individual shares or share classes;

• Public versus private preferred shares; and

• Other considerations when valuing shares.

MODULE 4: Discount and Premiums

This module focuses on recognizing circumstances where specific shareholdings require a discount or premium from rateable value.

In this module, you will gain a comprehensive understanding of:

• Majority positions and control;

• Minority positions;

• Publicly-traded minority shares;

• Valuation approaches to valuing minority interests in private companies;

• Factors affecting minority discounts; and

• The portfolio discount, blockage discount and discount for restricted shares.

MODULE 5: Assignments and Case Study

This final module of the course includes the Assignments and Comprehensive Case Study.

The Assignments and Case Study questions are designed to:

• Test the theoretical and practical knowledge you have gained throughout the course;

• Help you prepare for your final exam for the Intermediate Business & Securities Valuation course; and

• Help you prepare for the Membership Entrance Examination (MEE), which is the final step in the process of meeting the requirements to become a member and obtaining the professional designation Chartered Business Valuator (CBV) or d’expert en évaluation d’enterprises (EEE).

Textbooks required:

Canadian Valuation Services (Student Edition, 2008), Campbell, I., Carswell Publishers. (Ref.#0459280147)
The Purchase and Sale of Privately -Held Businesses by Albo, Bryk and Pigott, (Ref.# 0888006083) CICA
The Valuation of Business Interests, Campbell, I. and Johnson, H., CICA.(Ref.#0888006241)
** The Canadian Institute of Chartered Business Valuators’ Casebook.

NOTE: ** available from the CICBV office.

The books are available from the York Bookstore