BACKGROUND INFORMATIONValuation exercises remain a key discipline in business studies and practice. Having a realistic understanding of the value of a business or the value of shares in a business or investment portfolio is critical to decision-making and planning. And, clearly, privately owned businesses do not have as easy a mechanism to determine market value as do publicly traded companies. This session will provide the initial background by looking into the various users and uses for a valuation exercise (transaction; financial reporting; investment appraisal; litigation, tax etc) and the number of accepted methods for calculating the value of a business. Following this background, this presentation will examine some of the most common errors and oversights that are made in a valuation exercise which ultimately impair the credibility of the value conclusions or cause the conclusions to be misleading. The discussion will cover how such errors and oversights can be detected and avoided.OBJECTIVES OF THIS SESSIONThe objective of this session is to discuss and attempt to answer the following questions:What are the common errors found in a valuation exercise? How does one spot them, and what is the impact of these errors? How should a Prepare avoid such errors? How should someone using/ interpreting the valuation exercise be able to communicate such situations?These questions will be explored in the context of both the theoretical underpinnings and practical case studies.TOPICS ON THE AGENDAUses and users of valuation exercisesRefresh on valuation techniques(a) Cost approach(b) Income approach(c) Market multiples approachTop 5 common pitfalls in a valuation(a) Theoretical argument for each(b) Example of the specific pitfall (and its impacts) in practiceRecommendations for PreparersRecommendations for Users