#### How discounted cash flow method is used as a valuation technique?

Posted By : Ekta / Published on : 15-Sep-2017 05:31 PM / View : 796 / Comment : 1
Explain the steps to be followed in valuation procedure by discounted cash flow method. How can we say that it is easiest to use for assets and firms whose cash flows are currently positive?

• The steps we will use will be as follows.
1. Locate all the required financial data.
2. Calculate the discount rate and use it to discount the future value of the business.
3. Perform a discounted free cash flow (DCF) analysis.
4. Calculate the company's net present value (NPV).
5. Calculate the company's terminal value (TV).
6. Calculate the intrinsic value.

Intrinsic Value = Net Present Value (NPV) Discounted Terminal Value (DTV)

Intrinsic Value Per Share = Intrinsic Value Cash – Debt / Total Shares Outstanding

You can see through formula that while Computing Intrinsic Value per Share (Which is the difference between Market Price of Share and Share's Price based on Net Assets in the books of entity), Cash is an important ingredients to this. So Positive Cash Flow makes it easier to Compute.

24-09-2017 / 02:19:13 PM

• ##### Resignation of a partner from LLP
Posted By : Ekta / Published on : 27-Jul-2019 05:36 AM / View : 338 / Comments : 0

Will resignation of a partner from the LLP within one year of conversion from company to LLP will attract capital gain tax although the profit sharing of the remaining partner will be more than 50per cent??

• ##### Appointment of director in dormant company
Posted By : Ekta / Published on : 27-Jul-2019 05:28 AM / View : 418 / Comments : 0

Good Morning Members!

Kindly confirm me can we appoint a new director in a dormant company.

• ##### Requirement of filing PAS-3
Posted By : Ekta / Published on : 27-Jul-2019 05:25 AM / View : 447 / Comments : 0

Hello Everyone!

Is PAS-3 required to be filed every time in following situations where partly paid Equity Shares are issued:

1. On allotment of Shares?

2. On receipt of Call Money?

• ##### Incorporation of public company
Posted By : Ekta / Published on : 27-Jul-2019 05:23 AM / View : 291 / Comments : 0

Dear All,

Good Morning!

Please Tell me what are requirements we need for the Incorporation of Public Limited Company And Requirements and documentation for name Approval of Public Limited Company.

• ##### Query on Buy Back under section 68 of Companies Act, 2013
Posted By : Ekta / Published on : 27-Jul-2019 05:22 AM / View : 324 / Comments : 0

Dear Friends,

In case of buy-back of a private limited company, is it mandatory to attach the valuation certificate along with SH-8/ 9?

Secondly, where there are foreign shareholders taking part in the buy-back do we have to file form FC-TRS with RBI

• ##### Query on CSR Liability calculation
Posted By : Ekta / Published on : 26-Jul-2019 01:34 PM / View : 269 / Comments : 0

I have a query on CSR liability calculation.
To arrive at the Net profit for the purposes of calculation is the remuneration and bonus paid to directors is allowed as an expenses or it needs to be disallowed and added back to net profit??
As I understand the net profit as per section 198 is PBT and PBT is after allowing these expenses.

• ##### Applicability of CSR
Posted By : Ekta / Published on : 26-Jul-2019 12:12 PM / View : 275 / Comments : 0

Dear All,

If a Company Net Profit Before Tax for the year 2018-19 exceeds 5 crores whereas Net Profit after Tax does not exceed 5 crores.

Whether CSR shall be applicable to such Company?

• ##### Filing of Form STK-2
Posted By : Ekta / Published on : 26-Jul-2019 12:08 PM / View : 305 / Comments : 0

Can a Company file Form STK-2 without filing Form ACTIVE INC-22A?