How are player values worked out?

How are the valuations and selling prices worked out I wonder?

I doubt SI will give us this info but it would be interesting to know.

I started a game in the SPL with the intention of just signing Scots. The problem is that most players are vastly over valued, meaning I can find superior players for less money. It got me thinking how these clubs came to their evaluations.

Normally it is the last fee paid for the player. However if the player signs a new contract worth more then his current value his value goes up.

For example;

Player A is valued at £6,000,000

Club A offers him new 4 year contract at £100,000

Player A accepts the offer, value then becomes £20,800,000.

Then the situation of youth players come into play. I think that is somehow calculated by the outlining of player stats, rep, status within squad.

For Example;

Player B comes through youth academy of Club B.

His PA is around 40 but his CA is 157 aged 16.

He is assigned the status 'Hot prospect'.

Other players in similar situations values come into play.

His rep and club rep then are considered.

So the combination and consideration of PA, CA, Contract status, Other players value, his and club rep and possibly the level he is playing at.

*Just a theory though.