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Analysis on reasons for enterprise value evaluation

Author: ChenYueHong From: www.yourpaper.net Posted: 2009-04-07 04:27:31 Read:
Keywords style='FONT-SIZE: 10.5pt'> Abstract: enterprise value evaluation has a long history in foreign countries, but in China there is not a long time, until recent years was gradually conspicuous.With the further development of China's market economy, enterprise value assessment will become more and more concerns.The right to carry out the evaluation as the means to realize the maximum of enterprise value management, motivation of the enterprise value evaluation has certain practical significance.

In the fierce market competition, enterprises to survive and develop, must make their own value is recognized in the market, and constantly seek to increase the value of the way, in order to realize the maximization of enterprise value.Measurement of the definition, enterprise risk and return, to measure the enterprise value, has become a very important day-to-day work of investors and managers.Investors assess the value of the enterprise and to make trading decisions, making the stock market price reaches a new equilibrium.Enterprise financial personnel through the assessment of enterprise value, to understand the true value of the enterprise, make the investment and financing decision scientific, continuously improve the value of enterprise, increase the wealth of.

Development of , the market economy is based on the practice of
enterprise value evaluation

The reform of property right system promoted the asset appraisal industry in China has gradually developed from scratch and.The reform of property right system in our country is mainly the reform of state-owned enterprise property organization form and management mode, the objective of the reform is: to keep public ownership in the macro level, social total, establish ownership structure formed by multiple owners, to mixed ownership as the main body of the enterprises at the micro level, establish modern enterprise system.In this process, our country is not only a variety of enterprise organization form and management mode, the economic behavior is not the same happened with the traditional planned economy system, and the mass flow and the reorganization of enterprise assets.The merger of enterprises, contracting, leasing, joint, the group has made great development, joint-stock system has gradually become the main forms of organization, the planned economy system gradually according to the factory, "company law" transformation and reorganization is limited, Limited by Share Ltd, China state-owned limited company and stock cooperative enterprises.The enterprise's overall sales, business division and the sale of assets into shares trading, especially the stock listed company stock trading has been rapid development.The enterprise bankruptcy law breaks through heavy resistance to be implemented, the bankruptcy liquidation, enterprise type and division of assets auction become be accustomed to seeing things.The enterprise assets as collateral for loans from banks, to enterprise assets to other enterprises as economic security, enterprise to insurance companies and accident claim to the insurance company.The rapid development of state-owned and non state-owned holding company, investors (individual or organization) to carry out equity investment management to preserve and increase the value for the target.The vigorous development of the above activities, greatly promoted the development of enterprise evaluation, enterprise value evaluation results become the foundation and basis for smooth these activities.

Requires two, the activity of property rights transaction is the direct cause of enterprise value assessment

The reform of property right system requires a developed the property rights trading market.On the basis of enterprise value appraisal must establish in the developed property transaction.The property rights trading market consists of five factors: one is the diversification of property market main body, namely as a commodity business buyers and sellers; two is the property market system, including the property rights trading market, enterprise merger market, market, leasing enterprises auction market; three is the market mechanism, namely property prices determined by market competition; four is the property rights trading place statutory, property rights exchange or trading center; five is the enterprise value evaluation mechanism and correct assessment.Market of enterprise property in China has developed very rapidly in recent years, but not yet mature and norms, formed by market competition property prices is also difficult to achieve in a short period of time.In this case, the enterprise value assessment is very important to promote the property rights transaction.

The rapid development of three, the capital market provides a lot of opportunities for the enterprise value evaluation of

In 1981, the Chinese government issued treasury bonds, after the initial development of the nineteen eighties, 90 in the stock market has been developing rapidly, have been established in Shenzhen and Shanghai Stock Exchange, the securities and Exchange Commission and its permanent supervision institutions -- China Securities Regulatory Commission, and promulgated a series of laws and regulations.At the same time, capital operation climax in 1997, Shanghai and Shenzhen Stock Exchange has occurred more than 270 M & A events 211 listing Corporation.In 1998, nearly 400 companies were different degrees of asset reorganization.In July 1, 1999 the formal implementation of the "Securities Law", to promote the development of China's capital market will play a far-reaching influence.Listing Corporation issued shares listed by the examination and approval system to the approval system, to avoid false operation status of enterprise in to obtain the qualifications listed, request for information disclosure more standardized, at the same time properly regulate the reorganization of enterprise assets, relax the acquisition condition, provides the play for the assessment of the company value.

four, enterprise value management for enterprise value evaluation to create the conditions for the

The main problems existing in the current enterprise management is the management level backward, do not attach importance to the maximization of enterprise value management is the core of financial management.Enterprise value maximization as the goal of financial management has the following advantages: is based on cash flow, considering the time value of money and risk value.It can handle the relationship between short-term and long-term interests, greatly overcome the short-term behavior of enterprises in the pursuit of profit.The relationship between the risk and reward, to achieve the best balance the two.In full consideration of the interests of owners on the basis, to achieve all the stakeholder wealth maximization.It can optimize the allocation of resources, realizing the sustainable development of the enterprise, make the enterprise value and social value of unity.Not only the financial management in the guide of enterprise value, enterprise management is also more and more tend to value based management, the concept of enterprise value as the core concept of enterprise management philosophy, enterprise value evaluation has become a very important technique in enterprise management technology.Enterprise value evaluation achieved great success in the western countries, one of the important driving force is the western enterprises generally pay attention to enterprise value management.Enterprise value assessment and management as the international advanced means, is the future development trend of enterprise management in china.We urgently need to change the shareholders and their agents -- behavior of managers at present, build enough securities investment and trust fund, improving intermediary agencies, strengthen the function of market supervision, to take the enterprise value maximization as the goal of financial management, to the enterprise value assessment and create conditions, give full play to its function.Therefore, the correct implementation of the evaluation value maximization as the means, is to promote an important means of China's sustainable development of enterprises.
Enterprise value assessment and management as the international advanced means, is the future development trend of enterprise management in china.We urgently need to change the shareholders and their agents -- behavior of managers at present, build enough securities investment and trust fund, improving intermediary agencies, strengthen the function of market supervision, to take the enterprise value maximization as the goal of financial management, to create conditions for value assessment, give full play to its function.


(1) Cao Qingren, "on the theory of" regarding the value of the firm, "economic issues", 2005.7.
(2) Wu Lihua, "method" evaluation model of enterprise value, "Chinese assets assessment", 2006.8.
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