A dedicated valuation resource in Indonesia
CVA is a specialised area in our Financial Advisory Services division responsible for Valuation and related Corporate Advisory. Unlike many valuation specialists, the Valuation & Advisory team look beyond the immediate need to measure value. We have found that clients want more than just a view on value today. More clients are more interested in how this value can be increased and how things will look tomorrow. How does the asset fit into the corporate strategy and how can they best maximise the return on assets.
In this context, we work proactively with our clients to analyse the value drivers, understand how value can either be protected or enhanced and if required establish the best way for this enhanced value to be realised.
Valuation is a complex process involving detailed analysis and industry expertise. We have a dedicated team of ten Indonesia based valuation specialists who are supported by the regional and global resources of our worldwide valuation practice. Our experience in performing valuations enables us to ensure that our service meets client’s needs and to recognize how those needs can best be met.
A valuation of a company or business assets requires a thorough understanding of the business which involves an independent, objective and experienced assessment of a number of factors, including:
On 31st March 2004, the International Accounting Standards Board (IASB) published IFRS 3 “Business Combinations” setting out changes for the accounting of business combinations together with proposed amendments to IAS 36 (Impairment of Assets) and IAS 38 (Intangible Assets).
Apart from the abolishment of annual goodwill amortisation and the pooling of interests method, the IFRS 3 represents a fundamental change in requirements to a detailed purchase price allocation. Whereas historically, in the majority of acquisitions the excess purchase price over the fair value of the tangible fixed assets has often been allocated entirely to goodwill, the allocation of the costs of a business combination across all assets acquired and liabilities assumed is now required according to fair value measurements. All acquisitions will have to be accounted for under the purchase method and will involve rigorous identification and valuation especially of intangible assets newly acquired within a business combination.
We can assist the client in determining and allocating value to various entities or business units and analyzing the potential allocation impacts on their earnings and cash flows under different transaction structures; and determining and supporting fair market values for the acquired assets once the deal has closed.
We have experience in the valuation of intangible assets and intellectual property, as well as tangible assets (e.g., property, plant and equipment).
IAS 36 – Impairment of Assets: Impairment Reviews
All listed companies that report under International Financial Reporting Standards have to comply with the new provisions of IAS 36 from 31st March 2004, which involves: