Valuation criteria of small and medium enterprises

Abstract

Company's value is influenced by many factors. According to the scientific literature we can group factors influencing the creation of value of small and medium enterprises into internal and external factors. Internal factors are specific and appropriate to the concrete company. Internal factors accounting of R&D, recognition of expenditures, depreciation and amortization, expenses related with acquisition, reorganisation and restructure, taxes. Non-accounting internal factors contain these influencing value creation measures: loyalty of consumers and employees, organization factors. External factors are general measures that can influence value of all companies. External factors are related with features of the country. Traditional classification of financial valuation methods is not exact enough. Referring to caried out analysis of scientific literature, we identified 4 groups of financial valuation methods for small and medium enterprises: financial reports methods; cashflows methods; market methods; value methods.