Using Rule of Thumb Data to Uncover Cooked Books

Business Valuation UpdateVol. 30 No. 5
May 2024
industry analysis
market approach, benchmark, rules of thumb

Summary

In addition to using rule of thumb data to corroborate a value conclusion reached using other methods, the data are also helpful for validating historical financials—particularly for cash-intensive businesses. An example and some metrics for cash businesses are presented.