Company Incorporation - Valuation & Different Classes of Shares

Question

A lawyer client who currently trades in his own name is looking to incorporate a company and trade from that company.

1. Does a formal valuation need to be made of his existing business to enable a value for the transfer to the company or would something less formal suffice?

2. How do you differentiate between “A” and “B” class shares (voting and non voting shares) when you incorporate?

Answer

 A less formal process would suffice with the business being transferred into the company. There is no formal valuation process. The shares would be classified separately on the balance sheet.