One of the most common questions business owners ask when beginning a valuation engagement is: “What documents do I need to provide?” Having the right documentation ready from the start helps ensure an accurate, defensible valuation and keeps the process on track. At Corporate Valuations, Inc., we have completed over 1,000 valuations since 1983, and we have found that thorough documentation is the single most important factor in producing a reliable opinion of value.

Financial Statements

The foundation of any business valuation is the company’s financial performance. You should plan to provide three to five years of historical financial statements, including balance sheets, income statements, and cash flow statements. If your financial statements are audited or reviewed by a CPA, those versions are preferred, but compiled or internally prepared statements are also used frequently. Year-to-date interim statements for the current period are also important, as they help the appraiser understand recent trends and the company’s current financial position as of or near the valuation date.

Tax Returns

Federal income tax returns for the past three to five years provide critical information that may not appear in the financial statements. Tax returns reveal officer compensation, related-party transactions, depreciation schedules, and other items that valuators analyze when making normalizing adjustments. For pass-through entities such as S-corporations and partnerships, the individual K-1 schedules are also helpful in understanding distributions and allocations among owners.

Organizational Documents

Your appraiser will need copies of articles of incorporation, operating agreements, partnership agreements, or other organizational documents. These establish the legal structure of the entity and the rights and restrictions associated with ownership interests. Buy-sell agreements are particularly important, as they may contain valuation formulas, transfer restrictions, or trigger events that directly affect the value of an ownership interest.

Contracts and Agreements

Significant contracts, leases, employment agreements, non-compete agreements, and customer or vendor contracts all influence business value. Long-term customer contracts provide revenue stability, while expiring leases or key vendor relationships may represent risks. Loan agreements and debt schedules are also necessary to understand the company’s capital structure and any covenants that could affect operations or ownership transfers.

Operational Information

Beyond the numbers, qualitative information about the business is essential. This includes a company history and description of operations, organizational chart, list of products or services with revenue breakdowns, customer concentration data, information about key employees and management, and details about any pending or threatened litigation. Industry-specific information such as backlog reports, pipeline data, or regulatory compliance status may also be relevant depending on your industry.

Purpose-Specific Documents

Depending on the purpose of your valuation, additional documents may be needed. For gift and estate tax valuations, prior gift tax returns and trust documents are important. For divorce valuations, the court’s scheduling order and any stipulations about valuation methodology are helpful. For ESOP valuations, the plan document, trust agreement, and prior ESOP appraisals are essential. For litigation support, relevant pleadings, discovery responses, and opposing expert reports help frame the engagement scope.

Getting Started

Don’t worry if you cannot locate every document immediately. Our team will provide you with a detailed document request list tailored to your specific engagement type, and we are happy to work with your CPA, attorney, or financial advisor to gather the necessary information. The more complete the documentation, the more efficient and accurate the valuation process will be. Contact Corporate Valuations, Inc. to discuss your valuation needs and receive a customized document checklist for your engagement.