Cash Held in Escrow Accounts may either be cash that the business expects to receive in the future from a past transaction or cash the business has to payout for some past commitments. In business valuation analysis, cash held in escrow accounts are carefully analysed by business valuators because they can impact assets and liabilities as well as future cash flows and eventually affect the estimated value of the business. If the cash held in escrow accounts is cash the business expects to receive in the future from a past transaction, which is based on some expected conditions, such expected benefits are excluded in the estimation of future cash flow from which the fair market value of the business is estimated. If cash held in escrow accounts are cash commitments for a past transaction that the business has to payout at a future date, it constitutes a liability, the full amount of which is deducted from the benefit stream being relied on to derive the fair market value of the business.