Considerations on the discounted cash flow method in the determination of assets

The aim of this theoretical essay is to discuss, in the light of accounting and finance theory, the Judgment - REsp 1.877.331 of the 3rd Panel of the Superior Court of Justice (STJ), which decided that to determine the assets of a retiring partner, unless determined in the Articles of Association, the Discounted Cash Flow (DCF) method is not pertinent. As a basis for the argumentation of this essay, the concepts of assets and their characteristic of generating future economic benefits were incorporated. For the essayist, this characteristic is a beacon for measuring assets and the value of a company, which is made up of a set of tangible and intangible assets. The Discounted Cash Flow is considered one of the main methods for valuing companies. It is essentially financial, derived from the capacity to generate future projected benefits, discounted to present value, adding the value of perpetuity. This method can measure the company in its current situation without the need for growth projections or future macroeconomic factors since case law considers that the future does not belong to the retiring partner. However, the ability to generate these economic benefits cannot be disregarded, which could lead to a valuation that is not fair value, thus harming one of the parties in the dispute. Based on these aspects discussed in the essay, using Discounted Cash Flows in Asset Determination processes is considered pertinent.