Machinery and Equipment Appraisals
What is a Machinery and Equipment Appraisal?
A Machinery and Equipment Appraisal is used to determine the market value of businesses’ operating assets (Furniture, Fixtures, Equipment, Vehicles, etc.) at a specific date in time. All that’s needed is a fixed asset list with year, model, serial number, and performance maintenance schedule. A depreciation schedule can also be used.
Why would you need an equipment appraisal?
The most common reason our clients get a machinery or equipment appraisal is when a company’s assets are being used as collateral to get a bank loan. When being used as collateral, if you were to default on the loan, the bank would seize your machinery and/or equipment. A machinery and equipment appraisal may be necessary for a wide variety of purposes like:
- Mergers and acquisitions (business)
- Asset-based lending
- SBA lending
- Property taxes
- Partnership dissolutions
How do appraisers value your assets?
Machinery and Equipment Appraisals begin with an assessment of a business’s tangible assets. Tangible assets can include items such as furniture, fixtures, heavy machinery, and vehicles.
Whether for conventional financing or SBA lending, GCF Valuation uses in-house accredited appraisers for all engagements, including engagements that require an on-site inspection. All GCF Machinery and Equipment Reports are USPAP & SBA Compliant and include Fair Market Value, Orderly Liquidation Value, and Forced Liquidation Value.
Do equipment appraisals affect business valuations?
Yes. When our certified appraisers are conducting a business valuation, the final value includes all of the equipment that’s necessary for your business to operate. The machinery and equipment appraisal helps to identify the life span of the equipment often used in calculating capital expenditures, a key variable in future cash flow.
What is it like to get a Machinery and Equipment Appraisal from GCF?
GCF offers two types of Machinery and Equipment Reports:
- Restricted Desktop Equipment Appraisal: A Certified Machinery and Equipment Appraiser has not made a site visit and instead conducts a phone interview to review and discuss depreciation schedules and/or a fixed asset list with year, make, model, serial number, and performance maintenance schedule. The report will provide a summary of the equipment appraised ensuring compliance with USPAP reporting standards. The Restricted Desktop Appraisal Report is intended for a single user.
- Restricted Summary Equipment Appraisal: This appraisal includes a site visit and is used upon lender request or when a lender is seeking to collateralize assets as part of a loan. Our Certified Machinery and Equipment Appraiser (CMEA) visits the site(s) where the machinery/equipment is located, completes a physical inspection, provides a summary of equipment valued, and ensures compliance with USPAP reporting standards. The Restricted Summary Appraisal Report is also intended for a single user.
Keep learning about Business Valuations
GCF’s Business Valuation Accreditations
Your GCF Business Valuation appraisal team has one or more of the following business valuation accreditations:
- Accredited Senior Appraiser (ASA) – is recognized as having achieved the highest level of education, training, and report writing for business valuations. The ASA designation is the gold standard for a business valuation professional. (source: American Society of Appraisers)
- Certified Business Appraiser (CBA) – a very prestigious credential in the eyes of all who are familiar with it as it earned the reputation of being a difficult credential to obtain. (source: National Association of Certified Valuators and Analysts®)
- Certified Valuation Analyst (CVA)
- Accredited in Business Valuation by the American Institute of CPAs (ABV by AICPA) – a credential granted exclusively by the AICPA to qualified valuation professionals who demonstrate expertise in valuation through knowledge, skill, experience, and adherence to professional standards. (source: American Institute of CPAs)
- Accredited in Business Valuation (ABV) – credential is granted exclusively by the AICPA to CPAs and qualified valuation professionals who demonstrate considerable expertise in valuation through their knowledge, skill, experience, and adherence to professional standards. (source: American Institute of CPAs)
- Certified Public Accountant (CPA)
Over 25 years of experience and expertise in business valuations and appraisals. An accredited appraiser receives extensive training, remains in good standing, and follows specific industry practices to determine the value of a business.
GCF’s Machinery and Equipment Appraisal Accreditations
- Expert Equipment Certified Appraiser (EECA) – Our appraisers are recognized with a deep understanding of valuation principles and extensive experience by the Institute of Equipment Valuation.
- Certified Machinery and Equipment Appraiser (CMEA) – a CMEA professional has the expertise and certification to conduct a third party machinery and equipment appraisal.