The most frequent question I get from business owners, “what is business valuation and why does someone need a Lubbock business valuation?”

Most business owners, and, quite often, their advisors, have inaccurate conceptions of the value of their Lubbock businesses. This is not surprising, because there is no such thing as “the value” of any business. Value changes, often rapidly, over time. Yet it is important for Lubbock business owners to have current and reasonable estimates of the values of their businesses for numerous reasons. Some of these reasons include:

• The death of the primary owner. At this point, it is clear that control of a business will pass to someone else and a Lubbock business valuation is needed.
• The departure of a key employee. This departure may trigger the necessity to sell a Lubbock based business if he or she takes away the key contacts or critical energy that keep things going and growing. 
• The owner gets “tired” and decides to sell. This is an unbelievably frequent reason why Lubbock business ownership transfers. Unfortunately, if a Lubbock business owner waits until he or she is tired, they are already on the down side of the business valuation curve. In the process, their businesses lose a vital life force critical for ongoing growth and success. Therefor, a Lubbock business valuation is essential.
• An unexpected offer to purchase the business. Occasionally, a business owner will receive an unexpected offer to purchase the business and will, quite suddenly, sell out to take advantage of the situation. A Lubbock business valuation is critical to determine if the purchase price is a good value. 
• Business reversals occur. Perhaps a company fails to adapt to a changing market, competition arises from unexpected quarters, or an accident or bad luck generates substantial losses. Sometimes a Lubbock businesses will never recover, and at other times, a forced sale results. A business valuation will help in these troubling times.
• Life-changing experiences. Lubbock business owners sometimes encounter life-changing experiences, such as heart attacks, cancer, close calls in accidents, the death of a parent, spouse or friend, or other. The shock of such experiences sometimes fosters a strong desire to “do things differently with the rest of my life.” Business ownership transfers can be the eventual result of these life-changing experiences and a Lubbock business valuation is a must.
• Gift and estate tax planning. Gift and estate tax planning by Lubbock business owners is a normal means of business transfer. The absence using a proper gift/estate tax business valuation expert can also precipitate the forced sale of a business if a business owner’s estate lacks the liquidity to handle estate taxes, or if a failure to plan for orderly and qualified management succession cripples the business when the owner is no longer there.
• Normal lifetime planning. Lubbock businesses sell as the result of normal lifetime planning by their owners who plan for and execute the sale of their businesses (or transfer them through gifts) using a business valuation on their own timetables and terms.
• A divorce. Divorces involving family-owned or closely held businesses occur. Wild card divorce settlements or emotional changes resulting from a divorce can also create the necessity or desire to sell. 

A formal business valuation can communicate the company’s current position in the Lubbock market in many of these areas. Successive, frequent business valuations allow business owners and key managers the opportunity to measure and track the performance and value of the company over time against stated goals and objectives.

Lubbock attorneys often ask about the Business Valuation litigation support services we provide. As Business valuation specialists, we provide support to attorneys working on cases involving valuation and marital dissolution.  When a business valuation is called for in an valuation-related dispute, we provide necessary opinions.  If the case involves corporate damages, we provide the necessary opinions regarding alleged damages.  These services are fairly obvious uses for Lubbock based businesses.

The focus of this, however, is on some not-so-obvious services that business valuation professionals can provide in the context of business-oriented litigation.

In Lubbock litigations involving business valuation or economic damages issues, business valuation professionals are capable of providing a surprisingly broad assortment of litigation support services.  These services can begin before a decision is made to file a litigation, and can continue throughout the discovery, deposition, trial preparation and trial processes.  Lubbock Attorneys are increasingly learning that the effectiveness of business valuation and damages-related litigation support services is enhanced by retaining experts as early in the process as possible.

The fact is, most family law attorneys do not have a background in finance or accounting, yet are often confronted with complex financial issues in divorce matters. The services of an experienced financial expert can be vital to you and your client in such matters.

In vetting financial experts, look for those who specialize in Lubbock business valuation and forensic accounting. However, don’t pigeon-hole your expert. If your matter doesn’t require a business valuation or the tracing of dissipated assets, a Lubbock financial expert can still be of great help to you in each phase of the process: discovery, deposition, and trial.

Beyond business valuation, tracing, and testifying, below is a list of services a skilled Lubbock financial expert provides to help you uncover and understand financial issues:

• Determine financial documentation requests for subpoena
• Examine submitted financial documents
• Evaluate the accuracy of previously mentioned documents
• Assess whether further support is necessary
• Assemble relevant information
• Quantify the financial elements of a case
• Identify and classify marital and nonmarital assets and liabilities
• Assist with interrogatory drafting
• Support deposition questionnaire drafting
• Attend depositions for real-time financial support
• Analysis of the work product of other experts prior to the filing of litigation
• Analysis of alleged damages prior to the filing of litigation
• Mediation prior to the filing of litigation
• Assistance during the discovery process
• Preparation for deposition of other experts or fact witnesses

These assignments are customary not only to business valuation professionals, but also to Lubbock litigators handling matters which involve issues of business valuation or economic damages.  Some Lubbock attorneys request these services at the outset of engagements.  Others could potentially make their jobs easier and leverage their legal expertise by engaging competent business valuation litigation support services earlier in the litigation process.