Business valuation is the calculation of what a company or a share in it is worth as a whole: its assets, its liabilities and its ability to generate income. Key Solutions calculates value with the income, market and cost approaches, explains what drives it and prepares the financial data for a sale, an investment round or a dispute.
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In short
- When you need it: selling a business or a stake, bringing in an investor, a member leaving an LLC, a loan or pledge, a shareholder dispute, a strategic decision.
- What you get: a calculation using at least two approaches, a value range, sensitivity to key assumptions and a note on value drivers.
- Timing: in our experience, collecting and checking the data takes most of the time. We confirm the timetable after a first review of the accounts and put it in the contract.
- Fee: agreed individually, based on the purpose, the number of entities and assets, and the state of the accounts.
- How to start: send financial statements for two or three years and tell us why you need the valuation.
When a business valuation is needed
A valuation turns the price of a company into a figure you can defend in front of a buyer, a bank or a partner. Typical situations:
- selling the whole business or a stake;
- an investor entering the company, where the valuation sets the share the investor receives;
- a member leaving or being excluded from a Ukrainian LLC, where the law requires the share to be valued;
- loans, pledges and leasing;
- reorganisation, setting up a subsidiary or contributing property to share capital;
- shareholder and inheritance disputes;
- management decisions on which divisions and assets create value.
Three approaches to valuing a company
Ukraine's National Valuation Standard 1 names three main approaches: cost (asset-based), income and market (para. 38 of National Standard 1). We normally use at least two of them and explain any gap between the results.
| Approach | Basis | Works best for |
|---|---|---|
| Income (DCF, capitalisation of earnings) | Forecast cash flows and a discount rate reflecting risk and cost of capital | Profitable operating businesses with predictable revenue |
| Market (comparables, multiples) | Deal prices and multiples of comparable companies | Sectors with many public deals; a cross-check for other approaches |
| Cost (net assets) | Assets minus liabilities | New companies, asset-heavy businesses, liquidation |
Our calculation and a certified valuer's report
A value calculation for negotiations and an official property valuation report are different documents. Under Ukrainian law the official report is prepared and signed by a valuation firm certified by the State Property Fund with a qualified valuer on staff (Arts. 5 and 12 of Law No. 2658-III). Key Solutions does not hold that certificate. When a report is required by law, a court or a counterparty, we prepare the accounts and data for the valuer and explain the figures.
What the service includes
- reviewing two to three years of financial statements and trial balances;
- normalising profit for one-off items, related-party deals and owner expenses;
- calculating value with at least two approaches, with sensitivity analysis;
- a note on value drivers: margins, receivables, inventory, debt, customer concentration.
How we work
- Purpose, date and scope. We agree why the valuation is needed, the valuation date and the object.
- Data collection and checks. We collect the statements and documents and reconcile them with the ledgers.
- Normalising the figures. We separate one-off and non-operating items so profit reflects the real business.
- Two-approach calculation. We calculate value, build a range and test key assumptions.
- Report and discussion. We hand over the calculation and explain it to you, an investor or a bank.
Timing and fees
In our experience, most of the time goes into collecting and checking data. The timetable depends on the number of entities, the state of the accounts and how quickly documents arrive; we confirm it in the contract. The fee is agreed individually and depends on the purpose, the scope, the state of the accounts and the deadline.
What we need from you
- Financial statements and trial balances for two to three years.
- The charter, ownership structure and documents for key assets.
- A contact person who can answer questions within a few days.
- Management reports and budgets, if you have them.
What you receive
- a value calculation for the company or share using at least two approaches;
- a value range and a sensitivity table;
- a note on the factors that increase and reduce value;
- a list of normalisation adjustments with explanations;
- a financial data pack for a valuer, buyer, investor or bank.
Legal basis
Legal basis for the work
- Arts. 5, 7 and 12 of Law No. 2658-III (valuation of property) — certified valuation firms, mandatory valuation cases, the valuation report.
- para. 38 of National Standard 1 — cost, income and market approaches.
- Art. 24 of Law No. 2275-VIII (limited liability companies) — valuing a departing member's share.
- Arts. 1 and 3 of Law No. 996-XIV (accounting) — equity, purpose of financial statements.
Why Key Solutions
- Company
- ТОВ «АУДИТОРСЬКА ФІРМА «КЕЙ СОЛЮШНЗ», a Ukrainian limited liability company, EDRPOU code 39610085. The company's details are public in the Unified State Register (ЄДР).
- Contract
- We work under a contract: scope, timing and liability are agreed before work starts. Client information is protected by professional secrecy (Art. 11 of Law No. 2258-VIII).
- Group
- Key Solutions is part of Innova Consulting Group: legal matters are handled by legal.ua, crypto-asset taxation by crystal.tax.
- Office
- Our office is at 77 Velyka Vasylkivska St., Kyiv. We serve clients across Ukraine remotely. The specialists who run engagements are listed on the Our employees page.
Frequently asked questions
How is the value of a business calculated?
We start with the purpose and valuation date, collect several years of financial statements and calculate value with at least two approaches. Net assets give a floor, because equity under the Ukrainian accounting law is the difference between assets and liabilities. The income and market approaches add future earnings, the customer base and reputation, so for a transaction they are used together.
Which valuation approach is right for my company?
It depends on the business. For a profitable operating company the income approach leads and the market approach serves as a cross-check. For a company without stable profit or with most of its value in property, the cost (net asset) approach leads. We always explain why the results of different approaches differ.
Can Key Solutions issue an official property valuation report?
An official valuation report under Law No. 2658-III is signed by a valuation firm certified by the State Property Fund of Ukraine with a qualified valuer on staff. Key Solutions does not hold that certificate. We calculate value for negotiations and management decisions and prepare the accounts and financial data a certified valuer needs.
How is the share of a departing LLC member valued?
Under Article 24 of Law No. 2275-VIII the share is valued on the basis of the market value of all members' shares combined, in proportion to the member's share. The company must tell the former member the value and provide a justified calculation within 30 days, and pay within one year unless the charter sets another period.
How does a valuation differ from an audit or due diligence?
A valuation answers how much the company is worth and looks mainly at future income. An audit gives an independent opinion on whether past financial statements comply with the reporting framework. Due diligence identifies the financial, tax and legal risks a buyer takes on. Before an acquisition the three are often combined, so we plan the sequence of work in advance.
How much does a business valuation cost?
The fee is agreed individually. It depends on the purpose of the valuation, the number of legal entities and assets, the state of the accounts, the approaches needed and the deadline. Send us recent financial statements and describe the purpose, and we will come back with the scope, timing and fee.
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Let's discuss your valuation
Tell us why you need the valuation and as of what date, and attach recent financial statements. We will reply with the approach, timing and fee.
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