Our Valuation Process

At MILES Valuation Advisory Limited, we follow a structured and rigorous valuation process designed to ensure that each engagement is technically robust, transparent, and audit-defensible.

Our process reflects best practices under International Valuation Standards Council standards and financial reporting frameworks such as International Financial Reporting Standards and Hong Kong Financial Reporting Standards.

While each engagement may differ depending on the purpose and scope of the valuation, our typical valuation process consists of the following steps.

Step 1 — Engagement Scoping

The valuation engagement begins with defining the purpose, scope, and valuation basis.

Key matters typically determined at this stage include:

Purpose of the valuation (financial reporting, transaction, tax, etc.)
Valuation date
Standard of value (fair value, market value, investment value)
Assets or business units to be valued
Applicable accounting or regulatory framework

This step ensures that the valuation is aligned with the specific requirements of the client, auditors, and regulators.

Step 2 — Information Collection

Once the engagement scope is defined, we collect and review relevant information necessary for the valuation analysis.

Typical information requested includes:

Historical financial statements
Management accounts
Business plans and financial projections
Industry reports and market research
Corporate structure and shareholder information
Key contracts and operational data

We work closely with management to ensure that the information used in the valuation reflects the most reliable and relevant data available.

Step 3 — Industry and Business Analysis

A thorough understanding of the target company's industry environment and business model is essential for a reliable valuation.

Our analysis typically covers:

Industry structure and competitive dynamics
Market growth drivers
Regulatory environment
Key operational risks
Company-specific competitive advantages

This step allows us to evaluate the commercial sustainability and risk profile of the business being valued.

Step 4 — Selection of Valuation Methodology

Based on the nature of the business and available data, we determine the appropriate valuation methodologies.

Commonly applied approaches include:

Income Approach (e.g., Discounted Cash Flow)
Market Approach (e.g., Comparable Company Multiples)
Asset-Based Approach (e.g., Adjusted Net Asset Value)

In many engagements, multiple methods are considered to cross-check the reasonableness of valuation results.

Step 5 — Financial Modelling and Analysis

At this stage, we perform detailed financial modelling to estimate the value of the asset or business.

Typical analyses include:

Discounted cash flow modelling
Comparable company benchmarking
Market multiple analysis
Discount rate estimation (WACC)
Sensitivity analysis

Our modelling process is designed to ensure that the valuation conclusions are consistent with financial theory, market evidence, and professional valuation standards.

Step 6 — Valuation Conclusion

Based on the results of the valuation analyses, we derive an indicated value or value range for the subject asset or business.

Key considerations during this stage include:

Consistency between valuation approaches
Reasonableness of financial assumptions
Sensitivity of valuation outcomes to key variables
Reconciliation of different valuation methods

Professional judgement is applied to arrive at a balanced and supportable valuation conclusion.

Step 7 — Valuation Report Preparation

Following the completion of the analysis, we prepare a comprehensive valuation report documenting the procedures performed and the conclusions reached.

A typical valuation report includes:

Engagement scope and assumptions
Description of the subject company or asset
Industry and economic analysis
Valuation methodology and modelling
Key assumptions and sensitivities
Final valuation conclusion

Our reports are prepared to ensure that they are clear, transparent, and suitable for review by auditors, regulators, and stakeholders.

Step 8 — Auditor and Client Support

Where the valuation is prepared for financial reporting purposes, we provide support during audit review processes.

This may include:

Responding to auditor queries
Explaining key assumptions and methodologies
Providing supporting documentation for modelling inputs

Our experience working with major international audit firms allows us to efficiently address technical questions that may arise during the review process.

Why Our Process Matters

A structured valuation process helps ensure that valuation conclusions are:

Reliable
Consistent with professional standards
Transparent for stakeholders
Defensible during audit review

At MILES Valuation, our disciplined approach ensures that each engagement is performed with technical rigour and professional integrity.

If you would like to discuss your valuation needs, please contact MILES Valuation for a confidential consultation.