Valuation of an organized part of an enterprise
One of the strategic decisions of a company is to separate from its structures one of its organized parts, which can be sold or contributed in kind to another enterprise. To carry out this process, it is necessary to evaluate this organized part of the enterprise.
The valuation of an organized part of an enterprise is like the valuation of an enterprise. It requires, first of all, an in-depth knowledge of the specifics of the valued activity and its components. The characteristics of a particular organized part of an enterprise help to select the valuation method to be used to determine this enterprise’s value.
Three types of valuation methods are used to determine the fair value of a company: the property methods, the comparative methods and the income ones.
In accordance with Art. 4 (4) of the Corporate Income Tax Law, Art. 5a section 4 of the Personal Income Tax Law, and Art. 2 Section 27e of the VAT Law, an organized part of an enterprise is an organisationally and financially independent group of tangible and intangible assets, including liabilities, intended to carry out specific predetermined economic tasks. Unique for these components is their ability to independently perform specific tasks and activities.