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The 2023 AICPA Business Valuation Conference and One Thought on Valuation Adjustments

Chris Mercer

I arrived in Las Vegas early Sunday evening on November 13th for the 2022 AICPA & CIMA Forensic and Valuation Services Conference. Assume a company has reported an EBITDA of $2.0 Assume further that the appropriate EBITDA multiple is 6x and that the underlying equity discount rate is 14%. Normalized EBITDA is, therefore, $3.0

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What a Difference a Year Can Make

Class VI Partner

Interest rates were raised six times by November 2022, including four consecutive 0.75% hikes. Average EBITDA multiples have consequently dropped in comparison to last year’s frenzied M&A period. As a result, they are relying heavily on buy-side quality of earnings reports and ramping up financial diligence.

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