It is true that accounting is inconsistent in dealing with capital expenditures and operating expenditures of manufacturing firms vs technology or R&D based firms. The operating expenditures are designed to generate benefits in the current year whereas capital expenditures are…
How many times have we seen this designation in the corporate world? Does it ring any bell to you? Before we delve into this discussion, let us understand the background of why we need Board of Directors. We, as a…
Every company has two types of assets that creates value –1. Existing assets 2. Growth assets. For many matured companies such as Merck (NYSE: MRK),most of the value comes from the existing assets i.e. existing products, brands etc. For many…
Blame it on the bias during the valuation process, one tends to favor its value depending on which side of the negotiation table he or she is. One of the tools used to push the value up or down is…
The assumptions for valuations are so subjective that you would find myriad views on that. However, it is also true that those assumptions should be well backed with good evidence or rationale. Recently, I had a discussion on real options…