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Why Can I Only Add Three Years of Information Into The BizEquity Tool?

The IRS Revenue Ruling 59-60 notes that five years of data is helpful, but in virtually every valuation scenario the financial results from the preceding three years (most importantly the current year) will provide a sound indication of the firm's performance. If it is an uber-cyclical business, you can always ask for revenue and EBITDA figures from prior years and take them into consideration on your own. Our valuation engine asks about future growth and profitability, which addresses the future portion of any given cycle.

As a rule of thumb the prior three years will almost always play the primary role in determining value. That said, four or five years would be "better", but the cost of entering two more years of data is not consistent with the nature of our system and its usage.

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