<title>Use of a knowledge-based system for the valuation of unlisted shares</title>

Abstract

We present a knowledge based systems approach to the problem of the valuation of shares of private companies. At present the experts involved in this field perform their valuation manually and also treat each private company valuation as unique. Our approach provides the expert with several features: (1) The system is much faster than the current manual techniques used, with all calculations and matches taking place in under 10 seconds (on our current prototype). (2) The calculation and matching process is thorough and allows the expert to validate all results obtained. Also, due to the automated nature of the system there is not the possibility for steps in the calculation and matching process to be omitted; as is the case with the manual technique. (3) Due to the nature of the way that the system holds its information on the private companies, many companies data can be held at the same time and companies are selected for valuation when required. This feature lends itself to the larger accountancy firms which hold portfolios of clients. We have completed our initial prototype, based on a system design produced earlier by M. Jamurtas, and are currently in the process of having this validated and acceptance tested by experts out in the field.