Question

Please can you send me a reference for determining the appropriate years to use when valuing a company. That is, how may years would be recommended when forcasting or preparing the proforma statemetents. Brother in Africa

Answer 1

That entirely depends on the industry and type of company.
For stable, predictable cashflows in a mature industry, or with long-term contracts in place, you can do 10 years. I consider 10 years is a lot. No forecasting to 10 years can be accurate.
For a start-up company in the technology industry, you can't even forecast out to 3 years without me laughing. So you use other, unconventional methods.
So, anywhere from 3-10 years depending on the industry and type of company.

Any more info you can give us on the task at hand?