CBV Skills

 

Business Valuation, Normalized EBITDA & Quality of Earnings for Canadian SMEs

The Apex CBV Skill produces normalized EBITDA calculations, enterprise value assessments, and quality of earnings analyses for Canadian SMEs under CICBV Practice Standards. It is designed for use by CBV designates, CPA firms, and CEPA advisors who need defensible valuation frameworks on succession, estate freeze, shareholder dispute, or sale preparation files — without spending two days building normalization tables in a spreadsheet. All outputs require review and sign-off by a CICBV-designated Chartered Business Valuator before use in any legal, tax, or transactional context.

​

Normalized EBITDA The skill applies a full set of standard normalization adjustments to three years of reported financial data: owner compensation above market rate, related-party compensation and rent, personal expenses run through the corporation, non-recurring items, management fee normalization, and the distinction between maintenance and growth capital expenditures. The output is a structured three-year normalization table with each adjustment itemized, dollar-quantified, and rationale documented — weighted at 40/30/30 for growing businesses or equally for stable ones.

Enterprise Value Using the normalized EBITDA, the skill selects the appropriate EV/EBITDA multiple from a current Canadian lower mid-market benchmark database covering ten sectors from automotive Tier 2 manufacturing (3.5–5.5×) to professional services (5.0–8.0×) to SaaS (5.0–10.0×). It applies upward and downward multiple adjustments for revenue trend, customer concentration, CUSMA compliance documentation status, key-person dependency, recurring revenue quality, and capital intensity. Where comparable private transaction data is available, those transactions are cited alongside public comparable multiples.

Quality of Earnings The skill flags earnings quality risks that require disclosure in any transaction context: revenue concentration above 25% in a single customer, working capital trends inconsistent with revenue growth, related-party transactions at non-arm's-length prices, EBITDA margin swings exceeding 300 basis points year-over-year, deferred maintenance, and contingent liabilities including unresolved CUSMA tariff exposure. For estate freeze valuations, it confirms the LCGE qualification tests under ITA s.110.6 and flags any Holdco structure, passive asset, or intercorporate loan that may jeopardize the QSBC status.

Discount and Premium Analysis The skill quantifies minority interest discounts (15–35%), control premiums (20–40%), lack of marketability discounts (10–30%), key-person discounts (5–20%), and CUSMA/tariff discounts (5–15%) with documented rationale for each adjustment applied.

Who this skill is for: CICBV-designated CBVs, CPA firms providing valuation services, and CEPA advisors requiring a current enterprise value estimate for exit planning or estate freeze files. Not sold directly to business owners.