Business Valuation Methods 2600-DSFRz3fpMWP
1. Foundations of Value - Definitions and Premises of Value
2. Universal Principles and Standards of Value
3. Accounting and Non-accounting Sources of Information Used in a Business Valuation
4. Introduction to Core Valuation Methods
5. Assets based valuation approach - Types of Methods, Structure, Advantages and Disadvantages, The Scope of Application
5.1 Book Value Method
5.2 Adjusted Net Asset Method (Adjusted Book Value Method)
5.3 Replacement Method
5.4 Liquidation Method
6. Use of Discounted Cash Flow (DCF) Valuation Approach
6.1 Estimating Cash Flows (FCFF, FCFE)
6.2 Estimating Discount Rates (Cost of Capital)
6.3 Estimating DCF and Residual Value
7. The Market Approach ( Valuation Using Multiples)
8. Mixed-Valuation Approaches
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Term 2025Z:
1. Definitions of value and factors that create value |
Type of course
Mode
Learning outcomes
Upon completion of the course, the student:
In terms of knowledge:
• Knows and understands the methodology of business valuation, including the principles of forecasting cash flows, determining the cost of capital and identifying residual value. (S1_W01) (K_W01).
• Has knowledge of income-based methods (DCF - FCFF, FCFE, DDM), asset-based methods (NAV, replacement cost method, liquidation value method) and comparative methods (EV/EBITDA, P/E, P/BV multiples). (S1_W02) (K_W02).
• Knows and understands advanced economic theories and models (e.g. time value of money, risk and return) related to business valuation. (S1_W01) (K_W03).
• Knows the legal and regulatory conditions for preparing valuations (e.g. IFRS, International Valuation Standards, National Specialist Valuation Standards). (S1_W05) (K_W05).
• Understands the impact of macroeconomic factors (inflation, interest rates, country risk) and industry-specific factors (sector life cycle, sectoral regulations, technological innovation) on the valuation process. (S1_W05) (K_W05).
In terms of skills:
• Is able to prepare and use financial projections necessary in business valuation processes, including the FCFF, FCFE and DDM methods. (S1_U01) (K_U01).
• Is able to prepare projections of the profit and loss account, balance sheet and cash flow statement for valuation purposes. (S1_U01) (K_U01).
• Is able to calculate the cost of equity (CAPM, Fama-French three-factor model) and the weighted average cost of capital (WACC). (S1_U01) (K_U01).
• Is able to perform a DCF valuation, calculate terminal value (using the Gordon growth method or an exit multiple) and estimate enterprise value. (S1_U01) (K_U01).
• Is able to apply comparative methods, correctly select a peer group and interpret the resulting multiples. (S1_U01) (K_U01).
• Is able to accurately interpret technological, social, political, legal, economic and environmental processes and their impact on business valuation. (S1_U02) (K_U02).
• Is able to prepare a valuation report including assumptions, results and recommendations for management or an investor. (S1_U03) (K_U03).
• Is able to plan and organise individual and team work in the valuation preparation process. (S1_U04) (K_U05).
• Has the ability to self-educate and improve acquired qualifications. (S1_U05) (K_U06).
In terms of attitudes:
• Is ready to critically analyse and question valuation results (e.g. discrepancies between methods, overly optimistic forecasts). (S1_K01) (K_K01).
• Is ready to comply with professional ethical standards in the field of business valuation. (S1_K02) (K_K03).
• Understands the social responsibility of valuation (e.g. in restructurings, acquisitions or court proceedings). (S1_K02) (K_K03).
Assessment criteria
Course completion will be based on:
- a multiple-choice test and
- a project - group work (3-4 students).
The weighting of the respective assessment components will be as follows:
- test - 80%
- project - 20%
Bibliography
1. Koller, T., Goedhart, M., Wessels, D. and McKinsey & Company Inc. (2025) Valuation: Measuring and Managing the Value of Companies. Hoboken, NJ: Wiley.
2. Aswath Damodaran (2016), Damodaran on Valuation: Security Analysis for Investment and Corporate Finance, John Wiley & Sons,
3. Panfil Marek, Szablewski Andrzej red. (2011), Wycena przedsiębiorstwa . Od teorii do praktyki., Wydawnictwo Poltext,
4. Szablewski Andrzej., Tuzimek Rafał. (2008), Wycena i zarządzanie wartością firmy. Poltext, Warszawa
5. Szczepankowski Piotr (2007), Wycena i zarządzanie wartością przedsiębiorstwa, Wydawnictwo Naukowe PWN, Warszawa
6. Międzynarodowe standardy Wyceny
7. Krajowe standardy Wyceny Specjalistycznej