Assessing Financial Reporting Quality of Early Stage Private Companies

Content Provider	Semantic Scholar
Author	Sohl, Jeffrey E.
Copyright Year	2017
Abstract	There are a variety of widely accepted methods that are used in order to evaluate the financial positioning of companies that are traded on stock exchanges. However, these methods that are common in the public markets do not suffice for assessing companies that are privately held. Attempting to devise an intrinsic value using anticipated cash flows is ineffective given that most companies are pre-revenue. Deriving a value based off of assets held is also inaccurate given that a young company will be in the process of capitalizing itself and more of its assets cannot be represented on a balance sheet, compared to public companies. Furthermore, the sheer lack of raw data provided by the companies in some cases can also contribute to pitfalls in valuation attempts. In addition, the lack of reliability of private companies’ financial information makes the valuation of these companies difficult. This study aims to develop a framework to assess the financial reporting quality of these early stage private companies.
File Format	PDF HTM / HTML
Alternate Webpage(s)	https://scholars.unh.edu/cgi/viewcontent.cgi?article=1368&context=honors
Language	English
Access Restriction	Open
Content Type	Text
Resource Type	Article