Inspections and Appraisals
Residual Value Appraisals
The equipment leasing and finance industry relies on our proven record of providing expert equipment appraisals and portfolio valuations whether at the beginning of a finance transaction, end-of-lease, or incrementally to project used equipment values for strategic business decisions.
Our equipment valuations can be expressed in terms of fair market value, orderly liquidation value, or forced liquidation value, both in-Exchange and in-Place/in-Continued Use. Furthermore, we can provide estimates of economic useful life, remaining useful life of equipment, and exit strategy. They are fully USPAP compliant.
Clients appreciate our expert commentary, which we provide to support valuations, including perspectives on general primary and secondary marketplaces, current and future technology trends, legislative or regulatory effects, and other variables that may have an impact on residual values.
Our valuation methodology includes:
- Detailed review of equipment, attachments, and accessories including, when available, a breakdown of “hard costs” versus “soft,” direct and indirect costs
- Direct research including the background of the equipment manufacturer, current and projected market trends, and competitive brands of the equipment type
- Valuation, including analysis of sale results of like or similar equipment
- Review of governing documentation (When provided by a client) with focus on terms and conditions covering usage by the customer, maintenance obligations, return provisions, and end-of-term options
- Assessment of intended usage and equipment usage; and projected costs to un-install and remarket the equipment
RESIDUAL VALUE ANALYSIS
Future-value estimates based on past and current market conditions adjusted for future changes, if any, in the economy, regulations, level of use and maintenance, and geography. Carl Chrappa, the practice leader, is author of A Leasing Company’s Guide to Equipment Management, the book the industry relies upon for understanding residual value analysis in equipment leasing and finance.
Relying on our extensive databases we are able to reconstruct equipment markets as they existed in the past and perform appraisals based on actual data for a retrospective time period defined. We frequently have demonstrated this in expert witness testimony provided by our senior consultants in courtrooms at trial.