Download Practice Valuation Quest. - Remillard Management Associates

“Serving the Veterinary
Profession Since 1981”
Remillard
From the desk of:
Jim Remillard, MPA, CPC, CVPM
1971 American River Trail
Cool, California 95614-2132
Management
Associates, Inc.
(RMA, Inc.)
Co Founder & Member of
the Board of Directors
2002-2005
2009 Distinguished Life
Member Honoree
530.885.6113/Office
530.885.6159/FAX
530.308.8620/Mobile
E- Mail: [email protected]
SPECIAL PROJECT ASSOCIATES:
Sandy Walsh, RVT, CVPM
Jon Cunnington, MBA, CVPM
Practice Valuation Questionnaire
— CONFIDENTIAL —
_____________, 2009
Dr. ________________
PRACTICE NAME
Dear Dr. _______________:
I am providing you with the following appraisal questionnaire to prepare a Valuation Report
of your practice. This communication includes guidelines to assist you in providing me with
the information needed to conduct a thorough financial evaluation of the practice that you
want appraised. There may be some areas that are not appropriate for your situation, but
please complete as many as you can.
It is my understanding the practice is being appraised/valued for the purpose of determining
a Fair Market Value as part of a feasibility study on the possible acquisition of this practice:
“The price at which the Practice would change hands between a willing
Buyer and a willing Seller, neither being under compulsion to buy or sell and
both having reasonable knowledge of the relevant facts.”
RMA, Inc. is not a real estate appraiser and will not make any Appraisal of the real estate. All
valuations assume that the practice will remain in its present location and that it will continue
to operate in substantially the same manner as of as of the date of valuation. RMA, Inc. will
not be conducting any demographic studies or location suitability analysis. Additionally,
RMA, Inc. is not rendering an opinion as to the likelihood of the practice continuing to
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
generate the level of income utilized in the valuation or the quality of the clientele or expenses
incurred at any future date. The valuation to be prepared by RMA, Inc. is merely an opinion
as to the Fair Market Value of the practice at a particular point in time – without any opinions
or predictions as to the future performance of the practice.
Please complete this entire questionnaire and submit all of the appropriate and requested
information as soon as you possible can, along with the deposit that is specified in the latter
pages of this engagement letter.
RMA, Inc. will rely solely on information provided to us by you. We will not verify any of the
information, data, financial statements, inventory reports, asset lists, accounts receivable
reports, etc., that are provided to use for the purpose of preparing this valuation report. As
such, the Valuation report that will be prepared should not be a substitute of a potential
buyer to conduct a reasonable and thorough “Buyer’s Due Diligence” prior to offering to
purchase the practice.
Your responsibility is to use every reasonable effort to keep RMA, Inc. informed as to all
pertinent developments and all of the facts surrounding the practice and the preparation of
this report. In this regard, client acknowledges that RMA, Inc. is relying on information
provided by you, and for this reason it is incumbent upon you to use every best effort to keep
our office informed of any and all facts and information that have a bearing on the
preparation of an accurate Valuation Report.
1)
Please explain the purpose for which you are requesting this valuation.
2)
An estimate of the fair market value of the following assets as of the most current
month end. Please provide this date below:
_________________________ _____, 200__
Drug & Professional Supply Inventory *
Professional & Office Equipment**
Furniture & Fixtures
Leasehold Improvements:
Date(s) improvements made:
$
Value
____________________
____________________
____________________
____________________
____________________
Estimated life expectancy of improvements:
Practice Vehicles
Accounts Receivable
Cash In Savings & Checking Accounts
____________________
____________________
_______ Approx. __% collectable
____________________
Other Operating Assets
____________________
* Depending on the purpose of this valuation I will need either an estimate of the value of
the historical or original cost of all drugs, medications (less obsolete and out-of-date items),
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RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
supplies, laboratory supplies, surgical materials, kennel supplies and food, and over the
counter sale items (sprays, powders, collars, shampoos, etc.), or an itemized inventory. Please
separate the totals into medical and office supplies.
** At current fair market value. In other words if you needed to replace all of the
equipment at the practice with similar equipment (same age, model, condition, use, etc.),
what would it cost to do so. These assets will represent part of the tangible assets of the
practice. Therefore, it is critical that the list be specific, detailed and accurate. Do not use
"book value" (as reported on your Balance Sheet) or new equipment replacement cost.
(Please see attached illustration)
3)
An estimate of the fair market value of Practice real estate: (both land and buildings,
separate and distinct from other ventures, buildings, or residences in proximity with the
practice.)
Veterinary Practice Real Estate
Land
Building
$
Value
____________________
____________________

When was the last appraisal on the property prepared? ___________________________

Who was the appraisal prepared by? ____________________________________________

If you own the property is it held personally, by a partnership or corporation?
_____________________________________________________________________________

Are the property taxes included as an expense on the income statement, are they
included in the rent, or do you pay them personally? ______________________________

If you lease the property please provide a copy of the lease agreement and any
amendments that apply.

What are the current and future lease terms and monthly lease payments?
_____________________________________________________________________________

How is the lease rate determined: _______________________________________________
 Status of facility:
_____ Lease
_____ Own personally or in partnership
 When constructed:
_____
_____ Last remodeled

Is any part of the practice sub-leased (groomer, pet store, etc.)? _____________________
(Please provide details and copy of any sub-lease)
_____________________________________________________________________________
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RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017

What type of structure is the facility, i.e. freestanding, shopping center, etc.?
_____________________________________________________________________________

If you are not currently paying a fair market rent for the property where the practice is
housed and had to lease a similar facility in your immediate geographic area, what do
you think the monthly lease rate costs (excluding triple net costs) would be? Another
way of posing this question would – If you sold the practice today and then had to
lease back the facility to the new owner, what would the monthly lease rate cost be to
the new tenant? $_____________________________________________________________

How many square feet is the hospital? _______________
AREA OF HOSPITAL:
NUMBER
APPROX. SQ. FOOTAGE
Reception
Exam Rooms
Treatment
Surgery
Surgery preparation
Radiology/Ultrasound
Pharmacy
Laboratory
Kennel areas
Large runs
Bathing area
Isolation
Bathing
Doctor’s office
Business office
Grooming
Food preparation/storage
Medical supply storage
Conference room
Living space
Other (describe)

How do you handle covering emergency calls?
_____ Take own calls
_____ Refer to emergency clinic
— PAGE 4 —
_____ Other
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
Please provide details ________________________________________________________
____________________________________________________________________________

Are there any special zoning restrictions or building codes on the property?
_____________________________________________________________________________
_____________________________________________________________________________
What type of maintenance and repairs do you feel are needed on the building at this
time?_____________________________________________________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
— PAGE 5 —
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
Other Real Estate proximate to the Veterinary Practice Real Estate (e.g. residential rental
property next to practice real estate). Please describe below and indicate fair market value.
$
Value
____________________
____________________
Land
Building
Please provide us with the prior three years' tax returns & income statements (corporate,
proprietorship, or partnership, whichever is applicable). Tax returns are acceptable
alternatives if income statements are not available. If revenue is not broken out by category
(i.e. professional services, vaccinations, radiology, etc., please provide a break out of revenue
into at least the following categories: medical services, diets, retail, boarding, grooming, other
ancillary services, discounts and refunds). If you have a monthly breakdown of gross income
by month, for the past 60 months, we would also appreciate that analysis.
In an effort to report a realistic financial view of the hospital’s performance, please provide a
list of any personal or non-business expenses that have been included on the above income
statements. Provide a brief explanation of each expense and to what income statement
category it was charged.
Also please list any unusual or one-time expenses that are included on these statements,
along with a brief explanation of such expenditures.
Is the practice a corporation ?________
C-Corp, S-Corp, LLC _________________
If a corporation, are shareholders selling stock or assets of the corporation?________
Sole Proprietorship? _______________
Partnership? _____________________
Accounting method: ___ Cash or ___ Accrual basis
Fiscal year end? _______
Names of owners and percentage of ownership interest?
____________________________________________________
______%
____________________________________________________
______%
____________________________________________________
______%
____________________________________________________
______%
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RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
In addition, please respond to these questions to be considered in valuation of your
veterinary practice. PLEASE ANSWER EACH QUESTION IN DETAIL ON A SEPARATE
SHEET FOR REFERENCED RESPONSES.
1)
Were any gratuitous services provided by any person to the practice? (e.g. wife,
children, parents, friends, etc. providing managerial, accounting, legal, construction,
janitorial, lab or other services) If so, please state the estimated dollar value for these services
for each of the four base years.
2)
Adjustments to Income Statements. In order for RMA, Inc. to perform an accurate
appraisal, we need to adjust the accountant’s or internally prepared profit and loss
statements, from a “Tax oriented” to an “Economic” format, to reflect the true income
generation of the practice. We will review the expenses to isolate any owner discretionary or
non-operational (perks) (e.g. vacations, appliances for personal use, materials for construction
of the doctor's residential property, and other personal expenses, etc.) Please list any specific
financial benefits that the practice owner(s) receives in the following areas:
Automobiles (purchase/lease, insurance, R & M, etc., Insurance (all forms), Retirement funds,
Legal or accounting fees, Significant bartering, Free veterinary care of a substantial nature,
etc.
3)
Were any practice expenses paid individually on behalf of the practice but never
deducted on annual federal income tax returns? If so, please itemize for each of the four base
years.
4)
Were any individuals paid in excess of their true economic value contribution to the
practice? (e.g. wife or friend being compensated $500 per month for spending one hour each
month reviewing the periodic practice results of operations for each of the four base years). If
so, please state in detail their contribution to the practice, salary paid, fringe benefits received,
etc.
5)
What type of legal fees were deducted from practice gross income on the federal
income tax returns? Please specify the nature and amount. Also, were any other professional
fees deducted from practice gross income, which might be attributed to the doctor
personally? (e.g. estate planning, personal financial planning, divorce, investment counsel,
etc.)
6)
What hours is the hospital open?
___________________________________________________________________________________
7)
Please detail separately, by doctor, the total production and compensation summary
of each doctor who presently is an owner, partner, or staff doctor by each of the last four
years. This schedule should conform to the last four years' tax return expenses claimed. USE
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RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
THE WORKSHEET WE HAVE PROVIDED AS A GUIDELINE. If more than one DVM is
involved, please use a separate worksheet for each DVM.
8)
Do the principals engage in any activity not mentioned that may affect the economic
realty of practice operations? If so, please explain fully.
9)
Please include a SHORT history of the practice and the principals involved. Submit
any information which you feel may be of use to use in completing this valuation. (year
started and by whom, recent sale, merger, service format, number of veterinarians, etc.)
Please indicate the type of practice that you conduct, giving percentages of each (if
appropriate), such as, Small animal exclusive, small animal predominant, feline, avian, exotic,
specialty, emergency/critical care, etc.) Please detail the answer to this question here,
indicating percentages (as appropriate): _______________________________________________
___________________________________________________________________________________
10)
Has there been any material change in the practice in the last five years which may
affect the delivery of goodwill? (e.g. major building projects in the area, significant decline in
the number of transactions, material decline in the practice neighborhood, entry of specialists
in the practice, increase in the number of employee veterinarians in the practice,
establishment of satellite facilities of the practice, commencement of emergency clinic
operations in the area, etc.)
11)
Is the practice in compliance with all Federal, State and Local OSHA standards?
12)
Please provide a list of all employees of the practice that details date of hire, current
compensation rate, fringe benefits provided, etc.
13)
If available, please detail for each base year the number of transactions per year, the
dollars per transaction, the number of veterinarians in the practice for each base year, your
estimate or actual count of the practice's patient records, the average hours per week that
the doctors work, and the number of full and part-time support staff by year.
BASE YEARS
# Transactions/Year
# New Client Visits/Yr.
Avg. Transaction Fee
Number of DVM’s
#Active Client Records
#Active Patient Records
2009
__________
__________
__________
__________
__________
__________
2008
_________
_________
_________
_________
_________
_________
— PAGE 8 —
2007
_________
_________
_________
_________
_________
_________
2006
_________
_________
_________
_________
_________
_________
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
Hours/Week DVM’s Work __________
_________
_________
_________
How many full-time
Equivalent DVM’s were
needed to cover practice
during base years?
Support Staff #:
Full Time
Part Time
__________
_________
_________
_________
__________
__________
_________
_________
_________
_________
_________
_________
Worker’s Compensation Rate for Current Year: _________
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RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
REVENUE SUMMARY BY MONTH:
MONTH
YEAR _______
Jan.
Feb.
March
April
May
June
July
August
Sept.
Oct.
Nov.
Dec.
TOTALS
YEAR ________
YEAR _______
YEAR ________
YEAR _______
TRANSACTIONS SUMMARY BY MONTH:
MONTH
Jan.
Feb.
March
April
May
June
July
August
Sept.
Oct.
Nov.
Dec.
TOTALS
YEAR _______
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RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
NEW CLIENTS SUMMARY BY MONTH:
MONTH
Jan.
Feb.
March
April
May
June
July
August
Sept.
Oct.
Nov.
Dec.
TOTALS
YEAR _______
YEAR ________
YEAR _______
14)
What type of promotional and/or marketing activities does the hospital engage in?
Please provide copies of your brochure, newsletters and any other such practice promotion
materials.
___________________________________________________________________________________
___________________________________________________________________________________
___________________________________________________________________________________
15)
How many other practices (similar to the one being appraised) are located within a 3,
5 and 10-mile radius of your hospital (excluding your own)?
3-mile distance: _____________
5-mile distance: _____________ (including those in 3-mile distance response)
10-mile distance: ____________ (including those in the 3 and 5 mile distance answers)
50-mile distance: ____________ (answer for specialty practices only)
16)
Please provide us with a listing of all practice liabilities — which should include the
purpose of the note, the remaining balance, the monthly payment and the interest rate(s).
17)
Area map marked with location of the practice. Highlight other practices in the
immediate proximity to your practice (3 to 5 miles in urban; 5 to 10 in more suburban or rural
areas). Have any new practices been established within your immediate practice area in the
past 2-3 years? If so, please provide details?____________________________________________
18)
Photographs, VCR tape or DVD of the practice facility and surrounding area. This
should include all rooms and storage areas, equipment, front, sides and rear of facility,
— PAGE 11 —
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
outside sign, kennel areas — and any other specific information about the commercial, service
or trade area.
19)
Yellow Page Advertising. Please send copies of your ad, as well as the ads for your
immediate colleagues (neighboring practices).
20)
Does anyone have an option to purchase any part of this practice?
___________________________________________________________________________________
21)
Are there any environmental issues surrounding your practice?
___________________________________________________________________________________
22)
Are you, the hospital or any employee or other related party involved in any lawsuit
that effects the practice?
___________________________________________________________________________________
23)
Are there any current or past employee claims against the practice pending?
___________________________________________________________________________________
24)
Contact Information. Please provide the following methods of reaching you at and
away from the practice:
Home: (___) ____________________
Practice: (___) __________________
E-mail: _________________________
FAX: (___) ____________________
Inside line: (___) ________________
Mobile or Pager: ________________
Website Address: _______________
25)
As of what date would you like the practice to be appraised? ____________________
26)
Has this practice ever been appraised before? __________________________________
By who and when? _________________________________________________________________
27)
Name of practice’s attorney: __________________________________________________
Address: __________________________________________________________________________
Telephone & Fax Numbers: __________________________________________________________
e-Mail: ____________________________________________________________________________
— PAGE 12 —
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
28)
Name of practice’s accountant: ________________________________________________
Address: __________________________________________________________________________
Telephone & Fax Numbers: __________________________________________________________
e-Mail: ____________________________________________________________________________
After we have received responses to these questions, we will contact you if further
information is needed. Our hourly fee for appraisal services rendered is billed at $225, plus
any associated travel and/or out of pocket expenses — such as phone message units, fax
transmissions, copies of appraisal report, etc.
Our base fee range for a complete practice appraisal on a single practice runs between $4,000
to $6,500. A few appraisal reports, because of their complexity, contentiousness, lack of
agreement on the use of certain asset items, etc., can exceed the $6,500 estimate. This type of
valuation report is appropriate for practices that are being sold completely, partial associate
sale, partnership dissolution, divorce, etc.
Should you desire a more “scaled down” – valuation estimate report, to be used for purposes
not requiring the specificity, detail and full-on accuracy of a thorough practice valuation, you
might want to consider having an appraisal estimate report completed. This cost structure
usually runs in the $2,000 to $3,500 range – about half of a full-scale report. The basic hourly
rate for completing either appraisal approach is $225.00 per hour – as of May 1, 2009.
Please include a retainer deposit for 50% of the mid point in either of the above options
($2,000 for the estimate report and $3,500 for the full valuation report) with your materials.
The remaining amount is due upon completion of the appraisal.
Special Note for Potential Buyers of a Veterinary Practice: If this valuation is for the purpose
of evaluating the suitability of purchasing a veterinary practice then a scaled down version of
a complete appraisal report would occur. This service is charged at the hourly rate of $195,
and the client should expect that such an analysis will take between 6-15 hours to complete.
This would result in a projected cost range of between $1,500 to $3,000, to take the potential
buyer up to the point of deciding whether to make an offer to purchase the practice, and at
what level. The range of time associated with this type of project is primarily predicated on
the quantity, completeness, timeliness, accuracy, cooperation of the seller, and usability of the
information that is requested by the appraiser.
Itemized statements of RMA, Inc.’s time devoted to this project will be sent to you at the end
of each monthly billing cycle. Any amount due as a result of such billing, less any deposit
amount already provided to RMA, Inc. is due by the 10th of month following the submission
of the statement to the client. If the amount due is not paid by the 15th of the month following
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RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
billing, the unpaid amount shall bear interest at the maximum interest rate allowed by
California law until paid in full.
The majority of our evaluation work can be accomplished by telephone, with you visiting our
office, and through the mail. However, we will travel to the practice, upon your request or if I
feel that it is necessary to produce a report with the highest level of accuracy. Any such
additional costs for visiting the practice would be at your expense and would be charged out
in accordance with the attached fee schedule. A complete tape-recorded VCR (16 or 8mm,
digital or analog) or DVD presentation of the grounds, the facility and equipment is desired
and in most cases is sufficient to produce an appraisal report without visiting the practice. In
some instances, however, a physical review of the practice is necessary. If you should have
further questions about anything included in this note or during our telephone conference call
today, please call.
— PAGE 14 —
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
Jim Remillard, MPA, CPC, CVPM
Practice Management Consultant/Practice Valuator
Remillard Management Associates, Inc.
1971 American River Trail
Cool, CA 95614-2132
530.885.6113/Office — 885.6159/Fax
e-mail: [email protected]
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RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
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CHECK LIST OF ITEMS TO BE RETURNED TO RMA, INC.:
Accounts Receivable Summary
(Estimate percent of total that you feel is collectable: _____%)
Valuation Questionnaire (completed)
Mid Range Blue Book Value of Practice Vehicles (if appropriate)
Consulting Agreement (if none currently on file)
Corporate Buy-Sell Agreement (if requested)
Current Lease
Deposit (as requested above)
Fee Schedule (current)
Financial Statements — Including Balance Sheet for past 3 years
Financial Statement for Current Year in Progress
Tax returns (federal only) for the past 3 years:
For sole proprietor: Schedule C
If partnership: Form 1065
If C Corporation – Form 1120
If S Corporation – Form 1120S
(With all pertinent schedules for each business type)
Inventory Listing of Medical, Surgical, Office & Computer Equipment
Practice Rating Form (last page of this document)
Practice Brochure & Written Marketing Pieces & Information
Partnership or Shareholder Agreement (if requested)
Video Tape of Facility: Inside and Out (narrated, if possible)
Listing of Practices in the Area (placed on a map, if possible)
Offer for Sale of Practice You Are Considering Selling (if applicable)
List of all employees, indicating name, date of hire, position, salary, etc. Include
employment agreements for doctors or any managerial/administrative staff
Listing of all current leases, short and long-term practice notes details (origination
date, terms and conditions, current balance, number of remaining payments,
disposition of equipment at end of lease, etc.
— PAGE 16 —
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
CONSENT TO RELEASE DETAILS OF SALES TRANSACTION
TO AVPMCA NATIONAL MARKET DATA BASE OF SALES
AUTHORIZATION: I agree to allow many of the details of the transaction involving an
eventual sale of my practice to be included in the Market Database of Sales that is being
developed and maintained by the Association of Veterinary Practice Management
Consultants and Advisors (AVPMCA). I understand that such information will be entered
into this important national database in a manner that keeps the identity of my/our practice
anonymous. The information that will be entered includes, among other items, (a) the sale
date, (b) type of sale, (c) location within the USA based on AAHA’s five regions, (d) price for
the sale, (e) terms of the seller’s restrictive covenant, (f) whether real estate was involved and,
if so, sales price of the real estate, (g) type of business entity sold, (h) terms for financing the
transaction, and (i) the value established by any appraisal(s) that were completed on this
business. I understand that anonymous means that no specific details will be listed by
practice name, hospital or clinic owner, or specific practice location.
__________________________________________________________________________________
PRACTICE OWNER/AUTHORIZED REPRESENTATIVE
DATE
RMA, INC. POLICY REGARDING REFERRAL FEES
We want you to know that the policy of our firm and all of its associates, is that we will not
request or accept any referral or finder’s fees, or any other type of financial remuneration
for the benefit of our firm in the course of our consulting relationship with you.
This has always been our policy and you have our assurance that it will remain in effect for
as long as we provide practice management consultations and services.
Some consultants and advisors do accept such fees for referrals or recommendations to use
various services and/or products offered by other service providers. We feel that it is
important to share this policy statement with you so that:
1. You can inquire about and ask for clarification of the referral fee policies of all firms
before hiring them, and
2. You are aware that this is the only way we feel we can avoid the potential for or
appearance of any conflict-of-interest.
The owners and staff of:
Remillard Management Associates, Inc. Cool, CA
— PAGE 17 —
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
WORKSHEET
TOTAL PRODUCTION AND COMPENSATION SUMMARY OF EACH DVM WHO IS
EMPLOYED OR IS AN OWNER AT THE PRACTICE:
DOCTOR'S NAME: _________________________________________________________________________
NUMBER OF YEARS EMPLOYED IN THIS PRACTICE: ________________________________________
NUMBER OF DAYS PER WEEK (ON AVERAGE) THAT DOCTOR IS ON STAFF: _______________
DO YOU CONSIDER THIS DOCTOR TO BE FULL-TIME (4-5 days or shifts per week) _____________
IF LESS THAN F-T, WHAT DO YOU CONSIDER HIS/HER FULL TIME EQUIVALENCY? _________
ANY BOARD CERTIFIED SPECIALTIES:
YES _______________ NO ______________________
WHAT SPECIALTY/DISCIPLINE? _______________________________________________________
DID THIS PERSON SIGN A NON-COMPETE AGREEMENT? YES _________ NO __________
(Not permissible for associate DVM’s in California)
2009
__________
2008
__________
2007
__________
2006
__________
Individual Annual Production
___________
___________
___________
___________
Average Doctor-Client Charge
___________
___________
___________
___________
Base Salary (Yearly)
___________
___________
___________
___________
Production Incentives (___% paid)
___________
___________
___________
___________
Other Bonuses
___________
___________
___________
___________
Payroll Taxes
___________
___________
___________
___________
Medical Expense Reimbursement
___________
___________
___________
___________
Medical Insurance
___________
___________
___________
___________
Life Insurance
___________
___________
___________
___________
Continuing Professional Education
___________
___________
___________
___________
Travel & Entertainment Expense
___________
___________
___________
___________
Pension/Profit Sharing
___________
___________
___________
___________
$ Value of Free Pet Care
___________
___________
___________
___________
Other Fringe Benefits of a More Creative Mode: ________________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
__________________________________________________________________________________________
— PAGE 18 —
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
— _____________________________ —
Estimates of annual return (Net Profit) are considered to be worth 1 to 5 times its
calculated value. This rating form helps to identify the rating factor in determining the market
value of this practice.
1. Number of years the practice has been in existence:
1 = 2 years or less
2 = 3-4 years
3 = 5-6 years
4 = 7-8 years
5 = 9 years or more
_____
2. Competitive situation:
1 = many other practices in area, market glutted
2 = above average number of practices
3 = normal competitive situation
4 = below average
5 = no other practice in area
_____
3. Degree of risk (potential business failure):
1 = extremely high
2 = high
3 = normal
4 = low
5 = extremely low
_____
4. Growth of practice in the past 3 years:
1 = rapid decline
2 = below inflation by 5% or more
3 = at or near inflation
4 = above inflation 5 or 10%
5 = very high
_____
5. Location:
l = location inhibits practice
2 = below average
3 = average
4 = above average
5 = unique location
_____
6. Overall desirability of the practice to a potential buyer:
1 = minimum to none
2 = low
3 = normal
_____
— PAGE 19 —
RMA, Inc. Practice Valuation Report Information Questionnaire — 5/14/2017
4 = high
5 = very high
TOTAL
Divide the Total by 6 to arrive at multiplier =
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