VIENTERPRISE APPRAISAL FOR PURPOSE REPORT OF SHAREHOLDERS, GENERAL MEETING OF SHAREHOLDERS
The purpose of the general meeting of shareholders is to summarize the enterprises business situation and vote on the enterprises strategies and development plans for the future. This is also an opportunity for stakeholders to solve arising problems or re-elect a new board of directors when the old boards term has expired. The general meeting of shareholders is considered an important event, an opportunity for shareholders to directly discuss all business issues with business leaders.
When businesses want to get a bank loan, they make a loan application in which they always try to show a healthy financial position and have a good financial ability to ensure their debt repayment ability, because A healthy financial situation is one of the conditions for banks to consider lending to businesses. Therefore, to know whether the financial situation of a business is good or bad, it is necessary to conduct an appraisal to assess it, it is necessary to focus on the following contents:
Assess the reliability of financial statements:
Financial statements used: balance sheet, income statement, statement of cash flows, and notes to the financial statements. However, not all enterprises have the capacity to fully prepare these financial statements. Moreover, the financial statements required by the bank will provide information to the outside, so these reports when drafted may be different from those prepared internally by the bank. of the financial statements provided by the enterprise are not guaranteed. Although banks require audited financial statements, the vast majority of financial statements that businesses send to banks are not audited. Therefore, verifying the reliability of financial statements is a regular job of credit officers and they usually perform the following steps:
- Carefully study the figures of the financial statements
- Use financial knowledge and analytical ability to spot suspicious points in financial statements.
- Review the notes to better understand the questionable points in the financial statements.
- Invite customers to discuss, interview and ask for explanations about suspicious points discovered.
- Visit the business to observe and review the original accounting documents if necessary.
- Conclusion about the reliability of the financial statements provided by the enterprise.
Analyze financial statements:
- Analyze key items on financial statements
Content analysis of the change in important financial figures of the business over time (usually taking data from the last 3, 4, or 5 years). These financial statements figures include absolute and relative numbers (percentage of total assets for balance sheets or percentage of total sales for income statements). import). The relative numbers more clearly reflect the borrowers significant ongoing and significant financial trends and enable analysts to make comparisons with other firms or industry averages.
- Analyze key financial parameters:
* The solvency parameters.
* Operational parameters.
* Financial leverage parameters
* Profitability parameters.
Therefore, the Valuation of the Enterprise before holding the shareholder meeting will help the enterprise grasp financial activities and take necessary management improvement solutions to improve the efficiency of production activities. business, control the profits of the business. Helping state management agencies to understand the situation of production and business activities and the value of enterprises to have specific management policies for each enterprise such as corporate income tax, financial tax, etc. property, and other taxes.
Valuation of the enterprise is also the basis for settling and handling disputes arising between the shareholders of the enterprise when distributing dividends, contributing capital, violating contracts, etc.
In addition, it is also a basis for organizations, individuals, and the investment public to make decisions on buying, selling, and transferring securities issued by enterprises on the financial market; as well as the basis for merger, separation, dissolution, liquidation, joint venture, etc
The business valuation brings many benefits to the owner: protecting the business; knowing the ability of enterprises to adjust to improve efficiency in business, and production... Most importantly, the enterprise value appraisal is an important basis for attracting capital from financial investors.
