For a business owner, the term "business valuation" can sound intimidating. It brings to mind a long, expensive, and complicated process where strangers are picking apart the company you built. This feeling of losing control over your own financial narrative is a major source of stress in a divorce.

The good news is that a business valuation isn't a mystery. It’s a structured process with a clear goal: to determine the fair market value of the business so it can be accounted for in the overall division of assets. Think of it less as an audit and more as a professional appraisal, similar to how one would value a piece of real estate.

In Ohio, there is no single, mandatory formula for this. Instead, credentialed experts typically use one of three standard approaches to arrive at a fair value:

1.  **The Asset Approach:** This method essentially calculates the value of the business by adding up all its assets (equipment, inventory, accounts receivable) and subtracting its liabilities (debts, accounts payable). It answers the question: "What is the net worth of all the company's component parts?"

2.  **The Market Approach:** This is similar to how real estate is valued. The expert looks for recent sales of comparable businesses in the same industry and geographic area to determine a likely sales price for your business. It answers the question: "What are similar businesses selling for?"

3.  **The Income Approach:** This method focuses on the business's ability to generate future income. The expert analyzes cash flow and projects future earnings to determine what the business is worth as a going concern. It answers the question: "What is the economic earning power of this business?"

The right approach depends entirely on your specific industry and business model, as well as your goals in the valuation of your business. This is not a job for a regular accountant; it requires a business valuation expert who has substantial experience in divorce cases. Our role is to guide you through this process, offer a few candidates for you to consider in addition to completing research on your own, help interview and select the right expert for your unique situation, and ensure the final valuation is both accurate and fair, protecting you from a settlement based on guesswork or unfair assumptions.

Understanding the basics is the first step, but protecting your life's work requires a detailed strategy. To learn the 5 critical mistakes business owners make during a divorce and how to avoid them, download our free guide: **The Executive's Playbook: How to Protect Your Business and Your Wealth in an Ohio Divorce.**