IDENTIFICATION OF ENTERPRISE RISKS IN THE VALUE ASSESSMENT PROCESS

Abstract

The purpose of this article was to investigate the possibility of considering risk in the process of valuing an enterprise. The reasons and the essence of carrying out the valuation of the enterprise are analyzed. The main place of risk assessment in the process of valuation of the enterprise is considered. Only one of the proposed approaches directly determines the value of risk and its impact on value – profitable, the other approaches indirectly influences the risk on the value of the enterprise. A list of techniques for determining the value of risk in the context of applying the income approach by setting a discount rate is given. It is analyzed the essence of the methods and their main advantages and disadvantages are considered. The discount rate is based on the risk-free rate of return. The article analyzes the sources of obtaining the risk-free discount rate; in particular, its basis is the rate of return on government securities with maturity corresponding to the valuation period. It is determined that in countries with unstable currency and unbalanced budget, this approach is impossible to apply, as securities are denominated in national currency and the share of the risk component in the rate of return on these securities is very large. The possibility of using alternatives to determine the risk-free rate, their advantages and disadvantages, is analyzed. Features of consideration of different sources of risk are determined. Sensitivity is the basis for taking risk into account – the reaction of a stock or other object to the influence of certain factors, which improves the coverage of sources of risk. The essence and the analysis of the financial state of the enterprise, the main indicators that determine it, are explained and presented for the further application of these values in the analytical work. The author proved and distinguished one of the methods that fully meet the requirements of the market approach of enterprise valuation, namely the method of cumulative construction. The number of risk factors and the corresponding amount of the correction for the cumulative construction method are usually determined by the peer review method, which is best done through a survey among the management staff of the enterprise. The cumulative completion method covers key enterprise lines and enterprise characteristics, including enterprise size, financial structure, production and territorial diversification, client diversification, quality of management, and other specific factors. Valuation of the enterprise should take into account all methods, which in turn will ensure that possible sources of risk are taken into account.