BVR has taken the International Glossary of Business Valuation Terms 2001—which contains definitions commonly agreed on by the American Institute of Certified Public Accountants, American Society of Appraisers, Canadian Institute of Chartered Business Valuators, National Association of Certified Valuation Analysts, and the Institute of Business Appraisers—and added 75 new definitions. The result is a more expansive source for BV definitions. A few examples:
—Average Revenue Per Unit (ARPU): a measure of the revenue generated per user or unit. This measure allows for the analysis of a companies revenue generation and growth at the per unit level, which can identify which products are high or low revenue-generators. (investopedia.com)
—Seller’s Discretionary Earnings: (as defined by BIZCOMPS®) – seller's discretionary earnings is defined by BIZCOMPS® as net profit before taxes and any compensation to owner plus amortization, depreciation, interest, other non-cash expense and non-business related expense and normally to one working owner. (BVMarketData.com)
—Z-Score: a statistical measure that quantifies the distance (measured in standard deviations) a data point is from the mean of a data set. In a more financial sense, Z-score is the output from a credit-strength test that gauges the likelihood of bankruptcy. A z-score of 0 is equal to a 50% probability of bankruptcy. (investopedia.com)
This comprehensive new list, BVR’s Glossary of Business Valuation Terms, is available for download at our Free Resources page.
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