Are Opagio valuations accepted by auditors?

Full Explanation

Auditors (both external for statutory financial statements and internal for goodwill impairment testing) require valuations to follow ASC 820 Fair Value Measurement or IFRS 13 standards. Opagio uses compliant methodologies (RFR, MPEEM, Cost, Greenfield, Market, With-and-Without), so the framework is acceptable. However, auditors will scrutinise the reasonableness of key assumptions: discount rates, growth rates, useful lives, royalty rates, and CACs. They may request supporting evidence for comparable transactions, market data, and management's views. Opagio valuations work best as a starting discussion point rather than a finalised auditor submission. For material assets requiring audit sign-off, engaging a professional valuation firm is standard practice. The valuation profession maintains a code of conduct requiring independence and competence that goes beyond what an automated tool can represent. The distinction between indicative valuations and formal valuations is important for users to understand. Indicative valuations — the type that Opagio generates — use standardised methodologies and reasonable assumptions to provide a defensible range of values. Formal valuations, required for statutory reporting and regulatory compliance, additionally require professional judgement, independence certification, and professional indemnity coverage. Many Opagio users find that starting with a platform-generated indicative valuation reduces the cost of subsequent professional work by 30-50%, because the data gathering, asset identification, and initial analysis are already complete.

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