Business Owner expressed concerns for the number of years available, stating that trends are necessary for BV and that four would be standard.

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 professional appraiser, I can honestly say that the prior three years will almost always play the primary role in determining value. If a cyclical business is at the bottom of a cycle, well that is most relevant. If it is at the top of the cycle, then that will be most relevant. When performing SBA valuations, I always ask for 3 years of tax returns and 3 years of financial statements.

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.