Groves & Partners offer a range of intangible asset and intellectual property valuation services to provide accurate and reliable valuation assessments to a diverse range of clients in all industries. We take pride in offering a unique range of expertise in the field of intangible asset and IP valuations. Our team possesses the technical skills and understanding required to provide thorough and accurate assessments of intangible assets, which are often challenging to quantify.
Our technical expertise and experience in conducting a valuation of intangible assets include:
- Intellectual property
- Customer relationships
Clients often use IP valuation services such as patent valuations for various reasons. This includes financial reporting, transactions, tax purposes, litigation, and asset management. Valuing intangible assets can help clients comply with regulatory requirements, determine fair prices for assets in transactions, report taxes accurately, resolve legal disputes, and make informed decisions about how to allocate resources.
To address the subjectivity and lack of comparables that can arise in valuing IP, we use robust and defensible inputs. We also draw our extensive experience and expertise in valuing intangible assets across a wide range of industries and sectors.
Our experienced team consists of Chartered Accountants and Registered Business Valuers. Most of our team have extensive experience at Big 4 accounting firms in disciplines such as auditing, taxation and restructuring. This experience means our intangible asset and intellectual property valuation services are backed by practical experience, and strong technical rigour.
To ensure the most accuracy, our intangible assets valuation methods are tailored in consideration of the unique nature, its industry, risks, stakeholders, purpose of valuation, financial performance and market conditions.
Our typical process is outlined below:
1. Initial no-cost review
We commence by reviewing information regarding the intangible asset to the extent that this is available. In doing so, we will often review documents such as financial statements, licence agreements and samples of the intangible assets. This review allows us to make an early determination of the nature of investigations we will need to undertake, as well as to understand the technical approaches required in the intangible asset valuation.
2. Confirm scope of engagement and advise professional fees
Following the conduct of our initial review, we will advise you of our professional fees to undertake a valuation and the scope of our engagement.
3. Data and information request
We prepare a thorough information and data request schedule to enable an accurate valuation of your intangible asset. This data request is typically tailored to lessen the stress and the pressure involved when our clients gather their data.
4. Initial data and information review
We review the data and information provided in response to our information and data request schedule. We then conduct technical analysis, and consider any additional data or information required for the completion of our valuation services.
5. Preparation of a valuation report
We will present you with a report which provides a value of the intangible asset. This report provides a comprehensive explanation and reasoning for the selection of our specific valuation methods, and our calculation of value derived from the valuation method.
6. Meetings with you and your advisors
We typically conduct regular meetings with you and your other professional advisors, such as your accountants and lawyers. This is to provide time-sensitive advice regarding the nature of the valuation and our work. We are committed to maintaining ongoing communication and engagement with our clients.
What is the role of intellectual property (IP) in intangible asset valuations?
Intellectual property, such as patents, trademarks, and copyrights, can be a significant component of an intangible asset valuation. The value of IP is typically determined based on its legal protections, market demand, and potential for future income.
What are the different valuation methods used to value intangible assets?
Intangible asset valuation services such as IP valuation firms typically use the following methods:
- Income Method: Calculates the present value of future expected cash flows generated by the intangible asset, such as royalties, licensing fees, or other revenue streams.
- Market Method: Relies on comparable market transactions to determine the value of the intangible asset.
- Cost Method: Estimates the cost of developing or acquiring a similar intangible asset.
- Relief from Royalty Method: Estimates the present value of the royalty payments that would have been incurred if the intangible asset had been licensed from a third party.
- Multi-Period Excess Earnings Method: This method calculates the present value of excess earnings generated by the intangible asset over a period of years.
Which valuation method do you use in valuing intangible assets?
There are several valuation methods that can be used as highlighted above. Here at Groves & Partners, we assess the most appropriate method to use depending on the specific characteristics of your asset, availability of cost and market data, and the purpose of the valuation.
How long do intangible asset valuations take?
The duration required for an intangible asset valuation depends on several factors, including the size and complexity of the intangible asset and the purpose of the valuation. A straightforward valuation may take a few days, while a more complex one could take several weeks. Delays may occur when information or instructions are not promptly provided. However, we pride ourselves on delivering IP valuation services and other intangible assets promptly, even with short notice. Our team maintains regular communication with clients, and provides support throughout the entire process.
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