Fundamentals of the Liquidation Method of Business Valuation in the UK

When a company is put into liquidation, this is a method of evaluating the worth of a business. It measures what the company is worth as a whole when all of its physical assets and intangible assets are taken into account. It is only used when an organisation finds itself in difficult financial times or is solvent but wants to extract the remaining profit and wind down.


The fundamentals of  liquidation involves working out the value of a company based on what it would be worth if all of its assets were liquidated entirely (i.e. assets turned into cash). It’s typically used when an organisation has to sell off all of its assets to pay off different shareholders and creditors while settling other liabilities.



A few factors could affect the value of liquidation, one of which is how long the process will take. For some businesses, it could be the case that they earn some extra income whilst the company is being wound up, whereas, on the other hand, some organisations wouldn’t make anything throughout the process.


There are several ways a business can be valued throughout the liquidation process. 


Read Fundamentals of the Liquidation Method of Business Valuation in the UK

Location: United Kingdom

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