Fundamental assumptions must then be adopted under each basis, the most common being in respect of Market Value or Equitable Value, i.e. whether the machinery is to be valued for use in its working place or valued for removal from the premises at the expense of the purchaser.

Income approaches can sometimes be adopted for machines that have an income stream directly attributable to them, but this is rare in my experience. The income approach is much more commonly used to value intangible assets/goodwill.

Plant & Machinery valuations generally adopt one of these methods, however, the comparison method can also be stretched to include speaking with dealers for anecdotal market evidence/opinions and considering asking prices for similar assets.

 Finally, the basis and method of valuation should, if appropriate, also have reference to the best method of sale envisaged. For example, if we are considering a sale by auction to be the best way of maximizing the realization, then Market Value ex-situ assuming a sale as individual items is appropriate (and the prime method of valuation would be to seek auction sale comparable). However, a sale of all the machines by private treaty for removal is considered a better option, then Market Value ex-situ assuming a sale of the assets as a whole is more appropriate, and all comparable market evidence would be sought and considered.”