What are the advantages and disadvantages of using transaction data in your business appraisal?  What common errors are made when using transaction databases and how can these costly mistakes be avoided?  To help answer these questions, Business Valuation Resources introduces The Comprehensive Guide to the Use and Application of the Transaction Databases by Nancy Fannon ASA, CPA, ABV, MCBA and Heidi P. Walker ASA, CPA, ABV (both of Fannon Valuation, Portland, Maine).  This new Guide provides analysis of the Pratt’s Stats®, BIZCOMPS®, FactSet Mergerstat Deal Report, and DoneDeals® databases and offers guidance on how to avoid common errors associated with using each. 

Since each transaction database provides the information in a different format and with different definitions, using a value indication from any one database without being aware what the multiple really means may lead to a materially incorrect conclusion of value. To help avoid this, each of the databases is discussed in a detailed, consistent manner so the reader can cross-reference from one database to another in an effort to facilitate comparisons when using multiple databases.

Business Valuation Resources has posted the introductory chapter of The Comprehensive Guide to the Use and Application of the Transaction Databases to the Free Downloads page.  To purchase the Guide, click here.