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What is meant by Added Value Accountants Services

by | Sep 23, 2020 | Accounting Firm Services

Financial Health is achieved through many steps and processes, many intertwined with each other and involving financially informed documentation and requirements. Certain ‘value-add’ services provided by accountants and accountancy forms bridge the gap between financial needs, business needs, and legalities. Adding value and saving you, the business owner, time and money.

Financial Asset Valuations: Business Valuations, Property Valuations, and Intellectual Property Valuations.

All assets need to be valued on a regular basis. This includes both personal and business assets. They are essential components of all financial assessments and asset related transactions, protections and actions – from sales to loans, investments to drafting of wills and setting up of trust. The value of assets changes in relation to all sorts of factors, and one cannot be complacent about assets maintaining value. Nor should one pull figures ‘out of a hat’. Correct and current values, through professional valuations, help you make informed decisions that contribute to long term financial health.

Other essential ‘Value Add’ Services include: Business Restructuring, Shareholder Agreements, Sales Agreements and Business Advice.

These services are ideally informed by the figures and discovery provided by the valuation services detailed above, but they also stand-alone. Some can be structured and scaled as per the needs of individual clients, and can be useful when done on a regular, or annual basis. Others are usually required as one-off services. In the case of those primarily involving financially informed documentation, contracts and filing, it’s one-off service that combines legal and financial formalities.

Business Valuations fall under “Value Added” Services

Business valuations measure the fair market value of a business, or portion thereof. They are either required legally, or are otherwise essential, in the following g circumstances (among many others):
1. When you wish to:

  • sell your business, or your share of a business
  • establish a base value for future valuations
  • embark on a targeted business growth strategy
  • establish shares values

2. Assessments and dispute resolutions – from tax to divorce
3. Bequeath an Estate or set up a Trust
4. Draw up Buy and Sell Agreements
5. Plane investments and divestments
6. Gro or diversify a business.

Fair Market Value: Business valuations for selling businesses (or inviting investment), are done using a fair market value standard. This standard is the value by which a buyer of a business / share of a business can negotiate fairly, legally and transparently. With ‘all the cards on the table’: the business valuation does not simply arrive at a figure; it also contains all the information a buyer needs to know before agreeing on a price.

In a similar way, business valuations used for other purposes, such as establishing a starting point for a growth, rescue or exit strategy, give a full picture of the worth of a business in the current market.

The purpose of the business valuation to give buyers, sellers, owners, shareholders and other invested or interested parties accurate and comprehensive information. This allows them to make informed decisions and accept offers and settlements, based on reality and facts.

PROPERTY VALUATIONS falls under “Value Added” Services

Physical property is a capital asset that needs accurate valuation in almost as many situations as with business valuations. They are also required as part of a business valuation if the business owns property.

Property valuations are also beneficial when if you are not selling or needing to estimate the value of your property for any other immediate concern. Regular valuations put a ‘real value’ on assets that are especially vulnerable to devaluation from outside factors. There is a pervasive assumption that property ownership is a fail-safe investment, as property will always increase in value over the long term. It is also often (even if blindly) assumed that you will be able to sell property that you own – at what ‘it’s worth’. This is sometimes not the case:

  • Your idea of what your property is worth may not be accurate at all, and you could face serious disappointment.
  • You may miss opportunities to offload what you consider an asset, but what has become a liability somewhere along the line.
  • You may miss opportunities to invest in maintenance – not knowing the financial impact of not doing so when you could, or should, have.

Property valuations are always required when selling a property. As with business valuations, the valuation will include all the information that the buyer needs to make an informed decision. It will show the factors that affect price, how these factors were assessed, and also provide the seller and buyer with documents and survey information.

Depending on the type and estimated value of a property, and scale of the valuation (and what depends on it), the following would typically be included:

  • Area information
  • Market information (demand, or lack thereof – locally for the area, or in general)
  • Information based on trends in the market information
  • Comparative influences – e.g. recent sales and prices and projected sales and prices.
  • Maps and surveys (including aerial)

Local information that may drastically affect the value of the property, such as proposed business rights, gentrification, pollution from nearby industry etc.


Intellectual Property valuations are often underappreciated and overlooked. However, this type of valuation is a crucial aspect of Business and Personal Assets value assessments for many reasons.

Intellectual property is non-physical property that can have significant value. This value can be as much, if not more, than that of physical assets. This is especially true when it comes to trademarks and brands. Then there’s the often very significant value of patents and copyrights on commercially active material.

If you have built up a successful brand for your business, the value of that brand in driving sales can far outstrip the value of your inventory. It can be hard to do, but this needs to be valued correctly (and fairly) in assessing the value of a business. It is invaluable when planning future operations and marketing drives to grow a business, and when offering shares. It is also crucial when selling a business.

In many cases, buyers want to buy the commercial power of a brand rather than the actual stock itself – which could be identical to a competitor’s product that doesn’t sell without the brand behind it.

Brands, copyrights, trademarks, patents, and even trade secrets can be significant personal or corporate assets that add value to your business, or your personal estate.

However, it’s often difficult to quantify the value of intellectual property. It can be quite a process pinning down what contributes, and what detracts for the value of the intellectual property. Valuations will also use various methods that factor in a variety of influences on real value. The final figure can vary considerably between valuers.

For this reason, is a specific valuation process undertaken for intellectual property. This process bases a final value based on averages between various independent valuations.

Even if you aren’t selling a business or the intellectual property itself, it’s worth going through the process of valuing your intellectual property due to its potential or actual significance as a financial asset.

You may find it’s worth more than you think – increasing the value of your business or personal estate. In some cases, you may find it’s worth less than you thought. Either way, you need to know, in order to make informed decisions.

BUSINESS RESTRUCTURING falls under Added Value Services

Businesses that are stagnant, need to diversify (and find ways to do it) and businesses that are facing closure due to running at a loss – they all need restructuring with professional financial input and guidance.

Business restructuring for growth, increasing profitability and boosting the ‘bottom-line’:

Business restructuring can involve a multitude of things and require professional or expert input in many areas – from branding and marketing to HR. However, whatever is involved starts from one thing: the business is not achieving financial goals. Financial restructuring is therefore key.
This kind of restructuring includes:

  • Financial review and financial operations restructuring
  • Risk assessment (include tax risk and tax planning)
  • Debt restructuring
  • Compliance updates if needed

However, certain business restructuring services are focused on saving a business.

Business restructuring to save a business (and its staff and owners):

It can be bringing a business ‘back from the brink’, obtaining urgent investment for turnaround, or closing down parts of a business to allows the business owners to ‘reinvent it’ and maintain the core operations – and so dodge bankruptcy. These business restructuring services involve:

  • Debt restructuring for recovery
  • Other recovery measures
  • Turnaround management
  • Insolvency advice and process services

Often, businesses need both types of focus. If a business can be brought back from imminent closure, it will need the same services used to boost profits and stay competitive. The intensity, urgency and approach being the only thing that may differ.

Every business is different and faces different challenges, so a variety of restructuring needs are met with tailored restructuring services.

SHAREHOLDERS AGREEMENTS falls under Added Value Services

A relatively quick ‘formality’ required during restructuring, or on its own…

A current ‘urgent’ action for many companies is the redrafting and formalisation of shareholder agreements. This is due to the changes in the Companies Act that require Shareholders agreements to be in line with a company’s Memorandum of Incorporation. The changes make the MOI the most important document in the event of any disputes.

Previously, a shareholders agreement held legal sway. As an agreement that defined the relationships between shareholders, it was ‘separate’ from the MOI and in the event of a dispute – it was the formal contract referred to.

If your company has multiple shareholders, updating the shareholders agreement should be with your financial services professionals. This is to ensure that it is in line with your MOI, and with the provisions of the Companies Act.

Not doing so exposes your company and shareholders to financial and legal risk. This may also impact on the value of your business at any point when valuation is required, as value can be impacted negatively if a business is not statutorily compliant.

SALES AGREEMENTS fall under Added Value Services

The two most common sales agreements that need to be based on factual, accurate and detailed financial information are share sales agreements, and buy and sell agreements. All sale agreements require accurate valuation and financial expertise, as well as the correct legalese.

Share sale agreements can be as varied in their details and provisions as the businesses that need them. However, whatever their terms, they have three important things in common:

Share sale agreements are:

  • Legally binding contracts
  • Essential to formalise share sale terms in a way that protects shareholders and the business itself. While furthering the businesses’ long-term financial goals. (In practical terms – a shareholder may bring essential investment to a business – but what impact could it have if they allowed to sell their shares to a third-party).
  • Part of what a buyer of shares in a business will take over – and so factored into the value of the shares and the business.

Buy and sell agreements require accurate business valuations and related financial reviews, audits and projections, as well as the set-up of insurance policies that fund the buys and sell process. They protect businesses and their co-owners if a co-owner wants to divest or dies.

Some buy and sell agreements ensure that a business, as an entity, can purchase the departing shareholder or co-owners interest. Others allows the remaining co-owners to purchase the shares and so protect the business from hostile third-party interests, or from financial impact and influence from beneficiaries of estates that include the deceased or incapacitated co-owner’s shares.

BUSINESS ADVICE falls under Added Value Services

Last but not least – many businesses can do with tailored business advice, no matter what stage of operations it is in.

Business advice can be a little, or a lot. It can take the form of a one-of review with recommendations, or ongoing at intervals. It’s best done along with other financial services – as this maximises its value.

As business advice, it’s a one-stop-strategy and financial planning service that can help your business, at any point, to align it’s financial operations, practices and strategies with its financial goals.

Your accountancy professionals are best positioned to know what you need to do to achieve financial health and be protected from risk you may not be aware of.

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Erasmus Pretorius

With over 23 years of unwavering expertise, I am a seasoned Chartered Accountant committed to financial excellence. My journey in the realm of finance has been marked by astute strategic insights, meticulous attention to detail, and an unyielding dedication to precision. Over the years, I’ve navigated the complexities of financial landscapes, providing invaluable counsel to diverse clients. My proficiency extends across auditing, taxation, and financial management, coupled with a profound understanding of regulatory frameworks. As a registered professional, I have consistently upheld the highest standards of integrity and ethics, earning a reputation as a trusted advisor in the dynamic world of finance.