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Why Get an Equipment Appraisal?
There are several reasons for a business owner choosing to get an equipment appraisal for the machinery and other equipment utilized by the business. These reasons include collateral assessment, estate assessment, tax assessment, balance sheet restatements, and more.
Often, business valuation professionals give equipment appraisals on machinery for collateral purposes. If the business is going to use such machinery for collateral to get a loan from a bank, the bank will insist on having the machinery appraised so that the bank knows the worth of the equipment before offering the loan.
When the IRS determines the amount of taxes that a business pays, it takes into consideration the value of the business's equipment. In this case, the business often chooses to engage an unbiased business valuation professional to provide a certified equipment appraisal.
Whether it is for collateral, tax assessment, or any of the other reasons that businesses might get an equipment appraisal, it is important to businesses that their appraiser complies with Uniform Standards of Professional Appraisal Practice in their valuation. It can cost a business a good deal of money or borrowing power if the appraiser does not conduct the equipment appraisal properly.
Equipment appraisals should include full descriptions and documentation of business equipment, including photographs of all major pieces. Equipment valuations should also include reports of comparative values of similar equipment and a depreciated replacement cost analysis of the equipment.
Though an equipment appraiser is not obligated to inspect the equipment visually, the appraiser should have in-depth knowledge of any equipment appraised. The business owner may perform an inspection of equipment and is obligated to divulge any known defects or faults in the equipment.
AmericanValueMetrics.com offers professional, unbiased equipment valuations for small or medium sized businesses that need certified equipment appraisals.
American ValueMetrics
1585 South Loma Dr, Ojai, CA 93023
Phone: 805-646-4960 Fax: 805-715-7024