Wake Forest University sends students to work to learn value - The Business Journal of the Greater Triad Area:

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"I was close," said Cind y Cox Wilson, owner of in after a recent exercise in small business valuation. But she learned she hadn't been thinkingb enough about the impactof marketing. "I have a marketing plan, but haven'ty really thought ahead about how it will actually affecty the value ofmy company. I was only focusintg on day-to-day cash flow," she admitted. Wilson' company was a guinea pig in a new course in busines s valuation introduced this semester for graduate studentsat . The clasa required students to perform valuations ofactual businesses, whose owners volunteeref to open their books to the students.
The classe was designed and taught by Yvonne director of graduate studies at theCalloway School. Hinson said business valuatioh is usually taught through textbooks and case studiex or by studyingpublic companies, which is relatively easy becausw the numbers are all neatly packageds and the actual value is determined on the open Those methods have value in teachint theory, Hinson said, but she wanted to make her course more like real life. "Nothing is as cleanj and neat in the real world as it is in a case Hinson said.
"It's not a bad thingh for the students to be put in a situatiom where all therecords aren't necessarily intact and where they have to ask uncomfortable questions, like what kind of perks the owner pulls out of the Business valuation is becoming more which has implications both for entrepreneurx and accountants, Hinson said. Knowing how much a business is wortn is important to its owner mostlywhen it's time to sell or pass it on as an "But every business should alwaysd have an exit strategy" because you nevert know what turn life will take, Hinsom said.
"It's never a bad idea for a companty to knowwhat it's really Coming up with that figure is usuallt best left to a specialis because arriving at an accurate figure is A business, like anything is always worth exactly what someon else will pay for it, but predicting how much that will be takese a lot of calculating. That's true now more than in the Hinson said. The American Institute of Certified Publiv Accountants and the Financial AccountingStandards Board, two private bodies that help standardize accounting have recently been making changes to how a business' true value should be established.
For example, the FASB issue d new rules last fall on how to define and establishhthe "fair value" of a covering factors ranging from highest and best use of a propertyt to the creditworthiness of the participants in a transaction. "Accountantsd have to be more and more knowledgeable abourt to handlethese situations," Hinsom said. It could cost a small business anywher e from a few thousand dollars on up to have a professional valuation performed depending on but it would be worthwhile formany entrepreneurs, according to the Artwear Embroidery owner.
"Ths more new blood and fresgh eyesyou have, the more you can keep your own mind open and keep thingss moving," she said.