Current Regulations on Corporate Valuation and the Need for Introduction of Discounted Cash Flow Method

This study highlights inconsistency problems of domestic regulations on corporate valuation, where publicly listed stocks are evaluated by market values and unlisted the weighted average asset earning values. We analyze what changes have occurred in valuation methods used M&A practices Korea so as to shed some light this issue. Based 634 merger disclosure samples from 2006 2021, surrounding liberalization event value for merged companies 2012, proportion using discounted cash flow method (DCF) has increased overwhelmingly after not only calculation but also stocks. result confirms that DCF been generally accepted a practice. However, regulation averaging based book remains, relevant altogether should be revised accordance with purpose 2012 revision can implemented applying reasonable such DCF.